The decision was made after the current supplier, Sasol of Mozambique, revealed that its supply would take a hit from 2023 due to maturing fields at Temane and Pande.

While South Africa still relies on coal for the generation of 90 percent of its electricity needs, the construction of the LNG terminal will help the country diversify its energy sources.

The cost of the project will be determined only after a pre-feasibility study. The World Bank has pledged $2 million to help finalise the design, construction, and its operation plan. The company expects the project to be completed and become operations ready by 2024.

According to Transnet, the ground-breaking initiative is intended to unlock a backbone of the country’s natural gas network infrastructure to serve existing and growing gas markets, consisting largely of industrial and commercial off-takers located in KwaZulu-Natal, Mpumalanga, Free State, and Gauteng provinces.

Transnet chief business development officer Gert de Beer told the media that, “Ports and pipeline infrastructure are a long-term investment and we have to plan for this, with liquefied gas being a major catalyst to boost the country’s economy, especially for industrial users who are mainly located on the upper eastern half of South Africa.”

He also added that, “Transnet has identified significant industrial demand for natural gas and opportunities to leverage its ports, pipelines and rail assets to facilitate private investment in gas infrastructure for South Africa.”

The post South Africa to launch tender for first LNG terminal next year appeared first on International Finance.

According to Bloomberg, Energy Minister Gwede Mantashe in a speech to parliament in Cape Town, said, “We need to speedily work to entrench regulatory and policy certainty,” 

“The department has begun with the process of developing a Petroleum Resources Development Bill.”

It appears that South Africa passing a separate bill for oil and gas industry is extremely important, especially after Total SA announced its first deepwater oil discovery off the coast of South Africa, Bloomberg said. 

After the discovery, Total SA opened up a new oil and gas province in the region. Kevin McLachlan, senior vice president of exploration at Total announced that the Brulpadda discovery was drilled in a ‘challenging deep-water environment’. 

The Brulpadda well is located off the shore of Mossel Bay, which is recognised as a highly potential exploration site for the company.

The new policy will in fact secure the industry from any kind of uncertaining in the mining sector, which is largely suppressed owing to several debates over government’s new laws focused on redistributing the country’s mineral wealth. 

Mantashe said that the bill will be passed in hope to ensure ‘regulatory certainty to the upstream petroleum industry’ and boost its development in the future.

Currently, South Africa imports 60 percent of oil commodities in the form of crude. The crude is then processed at local refineries. 

South Africa is planning to establish itself as an energy hub and a key market player in the sub-Saharan African region.

The post South Africa develops new oil and gas policy to limit sector uncertainty appeared first on International Finance.