Argus Media Limited

03/07/2022 | News release | Distributed by Public on 03/07/2022 11:00

S Africa sees offshore gas output starting by 2026

South Africa's upstream oil and gas regulatory body said it expects the country to achieve its first offshore gas production within the next five years.

Block 11B/12B in the Paddavissie Fairway off the southern coast of South Africa will produce first gas by 2026, according to Phindile Masangane, chief executive of the country's Petroleum Agency (Pasa). The block is host to the Luiperd gas and condensate discovery, which TotalEnergies and its partners plan to fast-track by linking it via pipeline to an existing offshore production platform run by state-owned PetroSA. They are preparing to apply for production rights for the block before their existing exploration rights expire at the end of September.

The project partners announced the Brulpadda gas and condensate discovery in February 2019, and they followed it up with the Luiperd discovery in October 2020. To qualify for production rights, the consortium has to show evidence of proven petroleum resources, provide a field development plan and prove that they have the finances as well as the technical capability to implement the development plan. It also has to inform Pasa of in-principle gas and condensate offtake arrangements, Masangane said.

TotalEnergies has indicated that it is talking to PetroSA about an agreement to supply the 45,000 b/d gas-to-liquids (GTL) refinery at Mossel Bay on the south coast, she said. The refinery was halted after the offshore gas fields that provided its feedstock were depleted. The French firm is also discussing potential offtake agreements with state utility Eskom for gas-to-power projects at existing diesel power plants and possible new gas-to-power projects around the south coast.

"Once we accept the [production] application as compliant, then we will ask them to undertake an environmental authorisation process," said Masangane.

World class

The Paddavissie Fairway contains an estimated 3.4 trillion ft³ of gas and 192mn bl of condensate, which is sufficient to provide a steady gas supply of around 500mn ft³/d over 15 years, Masangane said. Luiperd contains an estimated 2.1 trillion ft³ of gas and 112mn bl of condensate, while Brulpadda holds 1.3 trillion ft³ and 80mn bl, Pasa estimates.

"These discoveries open a new, world-class exploration play in South Africa," Masangane said. "They demonstrate enough resources to initiate discussion about a commercial development."

The potential of the area is not limited to Brulpadda and Luiperd, she said. Three other prospects - Platanna, Woudboom and Blaasop - have yet to be drilled.

TotalEnergies' exploration and production manager in South Africa, Adewale Fayemi, has said previously that the firm will only start developing Luiperd and Brulpadda once the necessary infrastructure is in place to bring the gas to market. "There is no real offshore infrastructure on the south coast," he said.

But according to Masangane, TotalEnergies has inspected PetroSA's infrastructure and is satisfied that it can be used to fast-track development of Block 11B/12B. A final investment decision can only be taken once the production rights have been granted, Masangane added.

By Elaine Mills