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PetroSA negotiates access to Mozambique gas in 2024

Joshua Falcón.

April 18, 2024

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In order to anticipate an imminent gas shortage, PetroSA has established a preliminary agreement with ENH, the national energy company to safeguard Mozambique gas. This agreement is expected to enable the arrival of the first gas supplies to South Africa towards the end of this year, according to authorities from both companies.

The important obtaining of regulatory licenses

After obtaining the regulatory license necessary to commercialize gas, PetroSA moved quickly to close a deal that will initially provide 2 petajoules of gas per year . This volume could be expanded to reach 200 petajoules, which would guarantee supply to numerous industries, including large consumers such as ArcelorMittal.

The company ArcelorMittal , which consumes approximately 190 petajoules of gas per year, currently receives most of its supply from Sasol, another South African petrochemical company that has warned of future supply restrictions, due to the depletion of its gas fields in Mozambique.

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In addition, PetroSA is exploring the creation of a joint venture with ENH to meet gas demand in the deficient South African energy market . The proposed model is inspired by a similar initiative in Mossel Bay, where it is planned to collaborate with TotalEnergies to commercialize gas from recently discovered offshore fields.

Mozambique gas distribution

Sesakho Magadla, PetroSA’s chief operating officer, detailed that two joint ventures are being considered in Mossel Bay, one with Total for the Brulpadda field and another for the development of Block 9. However, PetroSA Gas Trading will be the main gas marketer.

The agreement with ENH includes the transportation of gas through the ROMPCO gas pipeline, which connects the Pande and Temane gas fields with South Africa. This infrastructure is essential for the distribution of gas in the northern region of the country, using the Sasol network.

PetroSA is currently in talks to finalize transportation agreements with Sasol and ROMPCO, which could provide it with access to additional capacities within the existing pipeline network. According to Sasol spokesperson Alex Anderson, technical evaluations are being carried out to optimize the transport of PetroSA gas to various destinations close to the current network.

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Source: Natural Gas World

Photo: Shutterstock