Energy Minister Jeff Radebe told MPs on Wednesday that the energy sector could pay a major role in President Cyril Ramaphosa’s drive to win $100bn in new investment for SA.
He was presenting his department’s budget vote to Parliament.
“President Ramaphosa has set us all a target to attract $100bn of investment into our economy,” said Radebe.
“We would like the energy sector to contribute as a minimum a quarter of this target.”
He said this “ambitious goal” could be reached in the energy sector with several initiatives that could include:
– Securing strategic stock through investment in new fuels tanks and in infrastructure required for South Africa to become a major shale gas producer
– Promoting Natural Gas (NG) by designing and building infrastructure required to transport natural gas and liquefied natural gas (LNG)
– Driving towards cleaner fuels by improving our refinery assets to meet world class emissions standards
– Supporting the transition towards electrification of transport, through key strategic partnerships
“We understand that this is an ambitious goal but we know we can do this, because we have successfully done it before in the renewables sector,” Radebe suggested.
“From 2014 to 2016, through the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), South Africa was able to secure investment of $10.8Billion into the renewables sector.
“This was significantly more than any other African state in the same period, and more recently we have continued growing the renewables sector through the recent signing of the Independent Power Produceers agreements, securing R56bn of investment into 27 new projects.”
Radebe promised that he will be producing new strategy documents on the country’s future energy mix, and a gas “masterplan”.
He said: “Globally, gas is the fastest growing fossil fuel and it is expected to catch up with coal over the next 20 years. It is emerging as the main hydrocarbon component of a more sustainable mix to power the world’s economy.
“Being increasingly accessible due to technological advancements and enhanced market liquidity, gas will see its demand steadily growing across the world.
“In SA, natural gas, whether imported via regional pipelines or liquefied natural gas (LNG) terminals at strategic port locations should be prioritised as it could play an important role in transitioning to a low-carbon economy.
“This direction will establish a game-changing demand platform for the future exploration and utilisation of South Africa’s latent shale-gas resources to the benefit of security of supply for future generations.”
SA is to discuss a new gas pipeline with officials from Mozambique, to carry gas from the North to the South of the country, and then on to SA – possibly linking into Sasol’s existing gas network.
Said Radebe: “We are firmly of the view that together with our Mozambican counterpart, we need to develop an infrastructure programme, which will allow the gas to be beneficiated through projects such as a Gas to Liquids Plant and other petrochemical facilities in Mozambique as well as a pipeline from ROVUMA (the gas-rich fields in Northern Mozambique) to the south of Mozambique, which in our view would enable construction of Gas to Power projects in both countries.”