SOUTH Africa has set itself the vision to enter the global gas market and promote the development of a gas market, not only locally but also in the Southern Africa Region, Energy Minister Mmamoloko Kubayi said.
For emerging economies, switching to gas as a competitive, cleaner and more flexible source for power production is a game changer, the minister said at the recent International Gas Co-operation Summit in Durban.
The summit brought together hundreds of representatives from around the world to coordinate efforts to achieve universal and sustainable access to affordable energy.
Participants agreed that gas will be an engine of economic growth and development in decades to come as more and more countries move towards gas-based economies and investing in import infrastructure to meet the growing domestic demand.
As gas is becoming the fastest growing fossil fuel, it is estimated that liquefied natural gas (LNG) supply will increase by 50 percent over the next five years. Over the next 20 years, LNG will catch up with oil and coal and emerge as the main hydrocarbon component of a more sustainable mix to power the world’s economy.
‘South Africa’s power, industrial and transportation sectors show great potential to contribute to a gas market development and we have done substantial gas demand analysis that indicates that the industrial and transport sectors represent four times the gas demand for power,’ Kubayi told the delegates.
South Africa has undertaken an extensive review of all legislation and regulation impacting on and required for the effective development of a gas industry in the country.
A draft Gas Amendment Bill will be tabled in the cabinet later this year. The amendments largely relate to a licensing framework for gas infrastructure and mandating the Minister of Energy to make determinations regarding the required infrastructure.
‘South Africa views the gas industry as a major contributor towards reviving growth, protecting living standards and facilitating economic transformation,’ said Kubayi.
South Africa’s introduction of gas into the energy mix could also play a major role in regional development, said the minister.
Sourcing of gas from neighbouring countries such as Mozambique can result in a win-win situation, where piped gas will stimulate economic activity along the routing areas in both Mozambique and South Africa, according to Kubayi.
Through regional transport networks, gas could be introduced into adjacent, landlocked member countries of the Southern African Development Community (SADC), said Kubayi.
A small-scale LNG industry has the advantage of addressing off-grid power generation for mining and industrial needs in remote locations in the region, Kubayi added.
In SADC, all member countries have, collectively and individually, committed to addressing constraints to speeding up of energy infrastructure project implementation.