Africa Oil & Gas: SA Minister initiates bilaterals with Moz and Namibia on cross-border gas prospects

South Africa Energy Minister Jeff Radebe initiated bilateral discussions with Mozambique this week regarding the further development of the cross-border gas infrastructure linking South Africa’s energy and chemicals sectors to Mozambique’s vast natural gas resources.

Well over 100-trillion cubic feet (tcf) of natural gas has been discovered in Mozambique and there is an expectation that, with further exploration and development, the resource could be enlarged in future.

Speaking at the conclusion of a meeting of Southern African Development Community (SADC) energy and water Ministers in Johannesburg, Radebe said he intended travelling to Mozambique “shortly” to further advance bilateral discussions with his counterpart Ernesto Max Tonela.

He indicated that his initial discussions with Deputy Mineral Resources and Energy Minister Augusto de Sousa Fernando had focused on taking the partnership that had already existed between the two countries through the Rompco pipeline to “the next level.”

Rompco is a joint venture between JSE-listed energy and chemicals group Sasol, Companhia Mocambiçana de Gasoduto and the State-owned South African Gas Development Company, or iGas. The 865 km Rompco pipeline carries gas produced at the Pande and Temane fields, in southern Mozambique, to South Africa, where Sasol uses most of the gas to produce electricity, fuel and chemicals. It also sells some of the gas to around 320 industrial customers in South Africa.

However, far larger discoveries of gas have been made in the Rovuma basin, situated in northern Mozambique, where energy group’s Eni and Anadarko are beginning to develop liquefied natural gas processing facilities, with the intention of selling gas to customers mostly in Asia. Some commentators believe there is also potential to build a pipeline from the area to South Africa, but the proposal remains at a concept stage.

Radebe stressed that South Africa would be adopting a regional perspective to the gas opportunities and revealed that he had also held discussion with his Namibian counterpart on ways to unlock that country’s Kudu gas reserves.

In a statement issued following a workshop on how to develop a regional gas market and infrastructure, the SADC Energy Ministers endorsed a proposal to strengthen energy cooperation and to enhance the contribution of gas in the regional energy mix.

The Minister also endorsed the development of a Regional Gas Masterplan, as well as the harmonisation of the policy and regulatory framework to promote gas trading and infrastructure development.

SADC deputy executive secretary Dr Thembinkosi Mhlongo said that a draft masterplan should be produced within the next 12 months and stressed that it would be the product of consultation not only with member States, but also with the private sector.

Radebe reported that there had been enthusiastic support for expanding the role of gas in the region by representatives from energy companies, commercial banks and development finance institutions who participated in the workshop.

Gas also emerged as a central theme of the broader meeting of energy and water Ministers, held in preparation for the thirty-eighth summit of the SADC Heads of State and government, scheduled for Windhoek, Namibia, in August.

The integral relationship between energy and water security was highlighted by the Ministers, along with the need to eradicate energy poverty and improve access to clean and safe water. Source: minigweekly.com

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