South Africa is aiming to prevent a potentially crippling gas shortage with a deal that will see PetroSA importing gas from Mozambique.
The state-owned oil and gas company is expected to commence imports from Mozambique’s national energy company (ENH) later in 2024, Reuters reported.
PetroSA recently obtained a gas trading license from regulators, paving the way for an agreement with ENH for an initial supply of 2 petajoules of gas annually, with the potential to scale up to 200 petajoules in the future.
This could potentially meet the needs of major industrial gas consumers such as ArcelorMittal, which currently relies heavily on gas supplied by Sasol. The latter has already cautioned its customers about impending supply restrictions as its gas reserves in Mozambique deplete.
South Africa’s next big energy crisis?
In August last year Sasol announced that South Africa was heading towards a “gas cliff” that could see the supply of industrial gas being suspended by mid-2026.
At the same time the SA Industrial Gas Users Association (IGUA-SA) warned that supply disruptions of that magnitude would lead to numerous plant closures, particularly in Gauteng and KwaZulu-Natal, Engineering News reported.
Joint venture in Mossel Bay
PetroSA aims to replicate its Mozambican joint venture model at Mossel Bay, which will see it trading gas from offshore fields, including those discovered by TotalEnergies.
"At Mossel Bay we will be looking at potentially two different JVs, one with Total for Brulpadda (field) and then another JV is for the Block 9 development, but the main entity that will trade gas for the group is PetroSA Gas Trading," PetrolSA’s CEO Sesakho Magadla told Reuters.
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