{"id":867542,"date":"2026-07-27T10:00:00","date_gmt":"2026-07-27T08:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=867542"},"modified":"2026-07-27T09:58:24","modified_gmt":"2026-07-27T07:58:24","slug":"south-africa-heading-for-a-cliff-and-people-will-have-to-pay-more-to-avoid-it","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/energy\/867542\/south-africa-heading-for-a-cliff-and-people-will-have-to-pay-more-to-avoid-it\/","title":{"rendered":"South Africa heading for a cliff \u2013 and people will have to pay more to avoid it"},"content":{"rendered":"\n

South Africa is still heading towards a “gas cliff”, with Sasol expected to cut gas supplies to customers from 2028, creating significant risks for households, industry and the broader economy.<\/p>\n\n\n\n

Even if South Africa manages to secure alternatives, households and businesses will likely have to pay higher prices for their gas. <\/p>\n\n\n\n

This is the feedback from Davies Tsikayi, Lecturer at the Wits Business School African Energy Leadership Centre and Associate Partner at Africa International Advisors.<\/p>\n\n\n\n

Tsikayi explained that the term “gas cliff” refers to a complete supply cutoff rather than a gradual shortage.<\/p>\n\n\n\n

“What Sasol did was announce to the market that come 2028, they will need to cut supply to the market,” he said in an interview with 702 Drive<\/a>.<\/p>\n\n\n\n

“What that means is that industries and residential areas that rely on this gas supply from Sasol will no longer be receiving it. That’s got huge implications for South Africa.”<\/p>\n\n\n\n

He added that, unless an alternative source is secured, South Africa will effectively have no gas supply available to meet many industrial and domestic needs from 2028.<\/p>\n\n\n\n

The biggest concern is the impact on industry, where natural gas is widely used for heating and industrial processes.<\/p>\n\n\n\n

Tsikayi said between 70,000 and 100,000 jobs depend directly on gas supply, while a further 500,000 jobs, both direct and indirect, are linked to these industries.<\/p>\n\n\n\n

“They’re using gas for industrial burners and for heating requirements, for different processes that require heat as a source of energy. As a result, you can see there are massive implications for the economy,” he said.<\/p>\n\n\n\n

He estimated that around 5% of South Africa’s GDP could be affected if gas supplies are cut without a replacement.<\/p>\n\n\n\n

While efforts are underway to secure alternative imports, Tsikayi said significant infrastructure challenges remain.<\/p>\n\n\n\n

He pointed to developments at the Richards Bay LNG terminal, where ExxonMobil and Eskom recently signed a heads-of-agreement with the terminal operators.<\/p>\n\n\n\n

Solutions will come at a higher price<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

However, transporting imported gas from Richards Bay to the country’s main industrial centres in Gauteng and Mpumalanga will be difficult.<\/p>\n\n\n\n

He added that another solution being explored is unlocking gas supplies from Matola, Mozambique, and transporting them via the ROMPCO pipeline to Gauteng.<\/p>\n\n\n\n

Although global gas markets remain volatile because of ongoing geopolitical conflicts, Tsikayi said South Africa still has time to secure supply if action is taken urgently.<\/p>\n\n\n\n

“The market currently is quite volatile because of the wars that we’re seeing, but hopefully by 2028, when South Africa needs to get this done, we can have a solution in place,” he said.<\/p>\n\n\n\n

He noted that major international energy companies, including ExxonMobil and TotalEnergies, could help guarantee LNG cargoes for South Africa if the necessary import projects move ahead.<\/p>\n\n\n\n

“What this calls for is urgency to address this gas cliff because it is something that is coming, and we’re two years away from it,” he said.<\/p>\n\n\n\n

Even if replacement gas is secured, Tsikayi warned it is likely to be significantly more expensive than current supplies.<\/p>\n\n\n\n

“LNG will come at a higher cost compared to the supply that we’re currently having right now,” he said.<\/p>\n\n\n\n

He also noted that Sasol is exploring a temporary bridging supply using methane-rich gas, but that this would also come at a higher price.<\/p>\n\n\n\n

“Whatever options are available to the industrial market, there’s going to be a financial hit that they will potentially face, and that will be passed down to consumers. Overall, that will lead to a higher cost of living,” Tsikayi said.<\/p>\n","protected":false},"excerpt":{"rendered":"

South Africa is still heading for a “gas cliff,” with Sasol set to cut supplies from 2028, likely leading to higher gas prices for households and businesses.<\/p>\n","protected":false},"author":92,"featured_media":867544,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2081651060062482678","_sma_x_attempts":1,"footnotes":""},"categories":[9874],"tags":[2240,853,3439],"class_list":["post-867542","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-energy","tag-sasol","tag-south-africa","tag-wits-business-school"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/867542","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=867542"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/867542\/revisions"}],"predecessor-version":[{"id":867546,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/867542\/revisions\/867546"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/867544"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=867542"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=867542"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=867542"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}