TotalEnergies, a major French oil company, has notified South Africa’s petroleum regulator that it plans to exit the 11B/12B offshore gas field, indicating a major setback for the country’s energy industry. Although no formal request has been made yet, a Petroleum Agency SA source has verified the company’s intentions.
TotalEnergies found the initial of two significant gas discoveries in Block 11B/12B along the southern coast of South Africa in 2019. These findings were considered potential drivers for reshaping the country’s energy sector, as the gas is anticipated to serve the inactive national gas-to-liquid refinery in Mossel Bay.
The 11B/12B block was poised to be a cornerstone in South Africa’s strategy to reduce dependence on coal and transition to cleaner energy sources. The gas finds promised to enhance energy security, drive economic growth, and diversify the nation’s energy mix.
However, TotalEnergies’ planned exit underscores the difficulties and uncertainties surrounding the development of South Africa’s offshore gas resources. This move raises concerns about the future of similar energy projects and the broader implications for the country’s energy strategy.
South Africa had high hopes that the 11B/12B gas project would bolster its economy by providing jobs and supporting local industries, particularly through the Mossel Bay refinery. TotalEnergies’ withdrawal threatens these anticipated economic benefits and adds pressure to find alternative energy solutions.
The announcement has stirred anxiety within the industry, prompting stakeholders to question the viability of offshore gas ventures in South Africa. The Petroleum Agency SA and other regulatory bodies will need to engage closely with potential investors to address these concerns and foster a favourable environment for energy exploration and development.
Despite this setback, experts believe South Africa still holds considerable potential for natural gas exploration. The focus will now shift to attracting new partners and investors willing to navigate the challenges and opportunities presented by the country’s offshore gas fields.
TotalEnergies’ decision to exit the 11B/12B offshore gas field presents a major challenge to South Africa’s energy ambitions. The country must carefully manage this situation by implementing policies that attract investment and support the sustainable development of its natural gas resources. As South Africa continues its pursuit of a cleaner energy future, the lessons from this experience will be crucial in shaping its energy strategy and ensuring long-term energy security and economic growth.
