• 4 minutes China 2019 - Orwell was 35 years out
  • 7 minutes Wonders of US Shale: US Shale Benefits: The U.S. leads global petroleum and natural gas production with record growth in 2018
  • 11 minutes Trump will capitulate on the trade war
  • 14 minutes Glory to Hong Kong
  • 2 hours China's Blueprint For Global Power
  • 44 mins Here's your favourite girl, Tom!
  • 2 hours Brexit agreement
  • 42 mins Peaceful demonstration in Hong Kong again thwarted by brutality of police
  • 6 hours Australian Hydroelectric Plant Cost Overruns
  • 1 day Idiotic Environmental Predictions
  • 9 hours IMO 2020:
  • 10 hours Yesterday Angela Merkel stopped Trump technology war on China – the moral of the story is do not eavesdrop on ladies with high ethical standards
  • 5 hours The Problem Is The Economy, Not The Climate
  • 19 hours The Ultimate Heresy: Technology Can't Fix What's Broken
  • 1 day NATGAS, LNG, Technology, benefits etc , cleaner global energy fuel
  • 2 hours 5 Tweets That Change The World?
  • 1 hour Bloomberg: shale slowing. Third wave of shale coming.
Alt Text

The Oil Stocks To Bet On In Times Of Uncertainty

Crude oil’s volatility has wreaked…

Alt Text

Bearish Sentiment Takes Hold Of Oil Markets

Oil prices were down on…

Alt Text

The Oil Rig Count Collapse Continues

U.S. oil and gas rigs…

Haley Zaremba

Haley Zaremba

Haley Zaremba is a writer and journalist based in Mexico City. She has extensive experience writing and editing environmental features, travel pieces, local news in the…

More Info

Premium Content

Could Massive Gas Find Help Boost South Africa’s Economy?

Total Exploration and Production Southern Africa recently made a massive offshore gas discovery off the coast of Mossel Bay. First reports of the newly discovered Brulpadda well speculate that the field holds anywhere from 500 million to more than 1 billion barrels of oil equivalent. While on the surface this would seem to be objectively good news for South Africa at a time when the country’s leadership is looking for ways to diversify the nation’s energy mix, the history of Africa’s long-suffering energy sector indicates that the future of South African energy remains uncertain, to say the least.

Total’s finding, while considerable, is not enough to take over South Africa’s currently coal-dominated energy mix on its own, but its timing is certainly fortuitous--for Total, at least--in a particularly weak moment in terms of the country’s energy policy and energy security. The nation’s Integrated Resource Plan (IRP), which oversees energy policy over the years of 2010 through 2030, has only been reviewed once since it was put into place in 2011. There is a new draft of the IRP from 2018 that accounts for an additional 8,100 MW of gas-to-power capacity integrated into South Africa’s energy industry by 2030, but this much-needed updated draft is still caught up in bureaucracy, waiting for approval.

If South Africa hopes to boost its economy and become an African energy industry frontrunner without seeing major exploitation of and damage to its environment, experts argue, it is paramount that the government needs to solidify its gas regulatory policy in a hurry. This is no small task, however, as at present South African energy policy is, in many ways, in a state of flux. Just months before Total’s major offshore gas discovery, South African Minister of Mineral Resources Gwede Mantashe had put a moratorium on all applications for oil and gas exploration to give his office the opportunity to update its process for licensing. One notable consequence of this decision was the relinquishing of a license to search for oil off South Africa by supermajor Royal Dutch Shell, thanks to what they saw as legislative uncertainty. Related: A Paradigm Shift In The Permian

Whether the country is legislatively ready for a major influx of resources and investment or not, Total’s discovery is already being lauded as a saving grace for the nation’s economy. President Cyril Ramaphosa’s investment-focused state of the nation address leaned heavily on this promise, saying that “this could well be a game-changer for our country and will have significant consequences for our country’s energy security and the development of this industry.” Ramaphosa acknowledges, however, that his administration has some work to do before that can become a reality. In a statement just hours after Total’s announcement of their discovery on February 7, the South African president said that his cabinet will need to overhaul its energy sector legislation in order to properly regulate this significantly changing industry.

It’s understandable why Ramaphosa is so hopeful about Total’s discovery and South Africa’s energy future in general. According to the South African Oil & Gas Alliance, the Brulpadda well discovery could translate to as much as 1-trillion rand (over $73 billion) for the South African economy over the next 20 years. While some rejoice, however, there are also many who take this news with a large grain of salt.

Environmental groups such as Greenpeace see not just a potential for economic upturn, but for vast environmental mistreatment and destruction. Greenpeace Africa’s Chris Vlavianos has dismissed the initiative as reckless, saying that “deep-sea drilling is far too risky. The possibility for an oil spill always exists, and the environmental impacts of deep-sea drilling for oil and gas are too significant to be ignored, with very little benefit or job creation for South Africans.”

By Haley Zaremba for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage



Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play