With a natural gas supply cliff in less than two years, our economy is facing a new blow to its energy availability.
South Africa is Currently Facing a New Blow to Energy Availability
Gas is a primary energy source for many businesses, including the beverage and glass industries. Sasol’s two gas fields in Mozambique, which are currently the major source of supplies, will stop supplying South African customers in the middle of 2026 because Sasol will use up all of the gas that is left.
Similar to electricity, there have been long-term indicators of this impending event. However, we now face an almost unavoidable supply disruption as a result of a combination of inertia in policy and a failure to make the kind of large-scale investment. That is required to build alternative infrastructure. This endangers the employment of 70,000 people in companies that use gas as a primary input and contribute R500 billion to the economy annually.
Well, there may be answers, but they will need prompt action from industry and government working together. The development of alternative gas sources and the infrastructure required to transport it to areas in need require significant investment, and the most viable solution now is to call for a 12- to 18-month transition period between the end of Sasol’s supply and the start of any new supply.
Government’s Participation in Establishing Favorable Conditions
Although there are several possible sources, such as significant developments in Namibia and Mozambique and the Brulpadda and Luiperd prospects off the Cape Coast, we have not yet started to invest in the necessary infrastructure to enable these sources of supply to reach the majority of users in Gauteng and KwaZulu-Natal.
For a while now, efforts for creating Brulpadda and Luiperd have been stalled because of concerns about Petro SA serving as an anchor customer. Since its final gas supply source ran out, PetroSA’s Mossgas refinery has been dormant for four years. For TotalEnergies to make the substantial financial commitment required to activate such resources, it must first establish contracts with major purchasers. Even if it succeeds, the project won’t begin providing gas until 2030.
A significant amount of coordinating work is required. To make the investment possible, prospective suppliers and logistics companies must enter into agreements with potential gas customers in the public and commercial sectors, ranging from industry to the production of power. The government’s participation in establishing favorable conditions for the required licenses, especially that of the Department of Mineral Resources and Energy and the Petroleum Agency of South Africa, is crucial.
Intricate Technical Factors to Take Into Account
It won’t be simple. There are intricate technical factors to take into account when determining which gas sources are most practical to access and how to move them. However, we may advance if we bring together the necessary knowledge, political will, and solution-focused attention.
We have to take action right now. Industry, especially prospective gas suppliers and users is prepared and eager to collaborate with the government to find answers. Years will pass before there is a long-term secure supply, so until then, we will need to take temporary steps to bridge the gap. One more day of waste is unaffordable.
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