Transitioning SA's Petrochemical Value Chain

Where could additional gas be sourced from?

Sasol’s 2022 Climate Change report suggests that any shortfall of gas from Pande/Temane leading up to 2030 could be supplied using Liquified Natural Gas (LNG) landed at the Matola terminal in the Mozambican capital, Maputo, a facility which is already at an advanced stage of project development. This LNG would then be regasified and piped to Secunda via a tie-in to the existing ROMPCO pipeline. Options for securing LNG through Richards Bay in South Africa are also being considered. The use of existing infrastructure and the Matola terminal will help to avoid long-term infrastructure lock-in, beyond that which is already committed.

One of the key factors that will determine the extent of increased gas utilisation in the synthetic fuels industry is the price at which gas can be procured on the global markets. Existing gas supplies via Pande/Temane are priced significantly below the price of gas on the global spot markets, as these contracts were locked in long ago when prices were lower. At the time of this study, the war in Ukraine has further substantially inflated gas prices, although many studies suggest that this is a temporary disruption and will not affect long-term gas price trajectories. The Business Engagement highlighted furthermore that “the international gas market is changing, and there is no longer the opportunity for long-term low-price contracting.”

In terms of domestic gas supply, the large Luiperd and Brulpadda discoveries off the coast of Mossel Bay in South Africa are noted. However, if or when these are developed, their distance from Sasol’s facilities means that transport would most likely be via ship to the east coast of South Africa – construction of lengthy pipelines would be infeasible, particularly given lock-in considerations. Output from these two fields might also be considered for utilisation at the nationally owned PetroSA synfuels site in Mossel Bay. Whilst this site is currently largely closed, there may be a case to re-open it for green chemicals or fuels production for local or export markets.