Mineral Resources and Energy minister Gwede Manatshe says that government is in talks with a number of international companies around gas and oil business opportunities in South Africa.
In a media briefing on Friday (9 October), Mantashe said that this push comes ahead of new legislation which aims to attract investment and ensure synergy between oil and gas activities and South Africa’s environment and water resources.
As part of the discussions, Mantahse said that government is looking at the development of a new oil refinery in KwaZulu-Natal with Saudi-Arabia’s Saudi Aramco.
“The Central Energy Fund continues to engage Saudi Aramco in a pre-feasibility study into a crude oil refinery in Richards Bay. We look forward to a positive outcome of the Saudi Aramco evaluation. South Africa needs a new crude oil refinery,” he said.
Mantashe said that there has also been exploration in the country with French oil company Total.
“The company has again, this year, brought another oil and gas drilling rig for the Luiperd prospect in Block 11B/12B off the Mossel Bay coast,” he said.
“The drilling is expected to be from 180 to 300 days, with an estimated local of spend R1.5 billion.
“It is envisaged that various local companies and industries will benefit from the project. We are obviously thrilled with the confidence shown by Total in our government and our country and hope for even a bigger find of oil this time around.”
Mantashe said that the government also aims to diversify electricity generation sources as well as ensure local and regional development.
“Gas and renewables account for a significant portion of the power that will be procured in the short to medium term,” he said.
“We are re-positioning South Africa to be a serious player in the global gas market. We will promote the development of a domestic and regional gas market,” he said,
As part of this, Manthase said that his department will advance its gas to power projects through the Coega Special Economic Zone (SEZ) identified as the first Liquefied Natural Gas (LNG) import terminal.
“This lays a foundation for Gas to Power plants and converting existing power plants from diesel to gas,” he said.
“Present and future gas discoveries in our country should find their way to our power plants and other petrochemical facilities. ”