South Africa’s Oil and Gas Potential ‘Significant’ – Mantashe

Mineral and Petroleum Resources Minister Gwede Mantashe has emphasized the vast potential for oil and gas exploration in South Africa’s deep waters, following recent discoveries in the South Outeniqua Basin. Speaking at Africa Oil Week at the Cape Town International Convention Centre, Mantashe highlighted the importance of accelerating exploration efforts to tap into these resources.

“The discoveries of gas and condensate from two exploration wells drilled in Block 11B/12B offshore in the South Outeniqua Basin have proven that South Africa’s under-explored deep waters have significant potential for oil and gas,” Mantashe said. He further noted that these findings could stimulate further exploration and development in the region.

Namibia’s Orange Basin Success Sparks Interest

The Minister also pointed to the success of Namibia’s Orange Basin, where eight discoveries across three blocks were made by TotalEnergies, Shell, and Galp, potentially holding an estimated 3.5 billion barrels of recoverable oil. These discoveries have sparked increased interest from major petroleum companies, as it is believed the Namibian fields could extend southwards into South Africa.

TotalEnergies’ Withdrawal Not a Deterrent

Despite TotalEnergies withdrawing from offshore Block 11B/12B and 5/6/7, Mantashe reassured that development remains viable. He insisted that the exit was not due to a lack of confidence in South Africa’s potential, pointing out that TotalEnergies is still a major shareholder in blocks to the north of the Orange Basin and holds a 100% stake in a larger block in the Southern Outeniqua.

“There remains a good potential for other oil and gas players to partner with the remaining operator, MainStreet, and develop the block,” he added.

Key Exploration Projects Underway

Several significant exploration projects in the South African Orange Basin are moving towards development, according to Mantashe. These include:

• Preparations for drilling in the Deep-Water Orange Basin (DWOB) block operated by TotalEnergies.
• The proposed drilling of an exploration well in Block 3B/4B, with an option for four additional wells.
• Environmental authorization processes have started for drilling in the Northern Cape Ultra-Deep-Water Block.
• Exploration in Block 5/6/7 is projected to begin in 2026, targeting large oil and gas resources.

Legal Challenges and Environmental Protection

Mantashe acknowledged the risk posed by litigation against oil and gas exploration projects, which has already hindered two major seismic surveys. Shell, for instance, abandoned a seismic survey in South Africa but went on to discover oil and gas in Namibia. Similarly, ENI left South Africa after being involved in numerous legal disputes but later made significant discoveries in Côte d’Ivoire.

The Minister emphasized that exploration can proceed without harming the environment, referencing a successful 3D seismic survey conducted by Searcher on South Africa’s west coast earlier this year.

SAPREF Refinery Acquisition

Mantashe also highlighted the government’s acquisition of the SAPREF refinery, a joint venture between Shell and BP in Durban. The deal, concluded through the Central Energy Fund (CEF), was recently approved by the Competition Commission and is seen as a step towards ensuring the country’s energy security amid the shutdown of several refineries.

The Minister reassured investors that South Africa’s downstream sector remains attractive, even with the rise of hybrid vehicles, and urged the investment community to continue supporting the development of oil and gas to enable Africa’s prosperous energy future.

A Call for Sustainable Development

In his closing remarks, Mantashe appealed to delegates and investors at Africa Oil Week to invest in the oil and gas sector to promote sustainable development across the continent. He emphasized that the discoveries and ongoing projects signify a bright future for energy in South Africa and Africa as a whole.