Mantashe noted this week that the decision by TotalEnergies to leave SA is not a problem. Picture: Gwede Mantashe/X
The Minister of Mineral Resources, Gwede Mantashe has called for more investment into South Africa’s oil and gas sector.
The minister was speaking during Africa Oil Week on Tuesday held at the Cape Town International Convention Centre.
Mantashe urged investors both foreign and domestic, to look beyond renewables and recognise the untapped potential of South Africa's oil and gas reserves.
Moreover, the minister said that SA has the potential to raise its gross domestic product (GDP) by 5% to 8% with the development of the upstream oil and gas industry.
"So, investors, come to South Africa, it's not just a tourist destination, come and invest. We have got these deposits, and they are there waiting for investors to come and invest, make money, and help us develop the economy," Mantashe said.
The minister also noted that in the past two years, TotalEnergies, Shell and Galp have made eight discoveries across three blocks in Namibia’s Orange Basin, representing an estimated 3.5 billion barrels of potentially recoverable oil.
“These discoveries have led to a huge interest by major petroleum companies since it is believed that the Namibian discoveries may be extending southwards into South Africa,” he said.
“The discoveries of gas and condensate from two exploration wells drilled in Block 11B/12B offshore in the South Outeniqua Basin have also proven that South Africa’s under-explored deep waters have significant potential for oil and gas, and thereby signalling a need to accelerate exploration efforts,” Mantashe explained.
TotalEnergies has said that it is withdrawing from South Africa, but Mantashe insisted that development on the block (Block 11B/12B and 5/6/7) still remains viable.
“(There) remains a good potential for other oil and gas players to partner with the remaining operator, MainStreet and develop the block,” he added.
“Contrary to the view that suggests that TotalEnergies withdrawal from the block is tantamount to lack of confidence, it is encouraging that the company is a major shareholder in 3 blocks North of South Africa’s Orange Basin in the deep to ultra-deep waters, and a 100% shareholder of another larger block that is 3 times the size of the 11b/12b in Southern Outeniqua.”
The minister said that TotalEnergies had merely moved from a very difficult terrain to an exploration site that was much easier to exploit.
Mantashe said there were strong currents off the southern coast that made deep drilling and vessel mooring particularly difficult, which had resulted in TotalEnergies’ estimated gas price requirement being higher than market-related prices that PetroSA had asked for.
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