12 °c
London
Tuesday, February 7, 2023
No Result
View All Result
FurtherAfrica
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • Interviews
  • Understanding
  • Videos
  • Travel
  • Weekend
  • About
FurtherAfrica
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • Interviews
  • Understanding
  • Videos
  • Travel
  • Weekend
  • About
No Result
View All Result
FurtherAfrica
No Result
View All Result
Home Africa

LNG uptake in South Africa ‘will rely on price’

FurtherAfrica by FurtherAfrica
August 23, 2017
in Africa, Commodities, Economy, Export, Gas, Government, Infrastructure, Mozambique, Natural Resources, Oil, South Africa, Trade
Reading Time: 2 mins read
904 9
0
Share via QRWhatsappShare on FacebookShare on TwitterLinkedInPinteresteMail

Government policy can play a role in influencing the price, says Department of Trade and Industry official

Price will be a critical incentive to persuade SA’s industrial and transport sectors to switch from their existing fuel sources to liquefied natural gas (LNG).

Government policy can play a role in influencing the price, Kishan Pillay, director of upstream and midstream oil and gas industrial development at the Department of Trade and Industry, told a South African Oil & Gas Alliance presentation on Tuesday.

The government has started to develop a gas strategy as substantial offshore LNG discoveries in Mozambique and studies on shale gas fracking in the Karoo indicate there may be regional potential.

The first step is intended to be the building of coastal power stations fed with imported LNG to provide the anchor demand for investment in infrastructure and market development.

Pillay said the department had studied how the first 15 years of gas industrialisation, based on imported LNG, could be encouraged.

By looking at the industrial and transport sectors in the KwaZulu-Natal-Gauteng corridor, it found LNG demand from these sectors would be 24 petajoules (PJ) in the short term and 47PJ in the long term.

Industry was already using 9.6PJ of methane-rich gas and would switch to LNG if the price was similar, at about $6 to $8 per million British thermal units (mmbtu). It was also using 7.7PJ of coal and to compete with that LNG would have to be priced at less than $4 per mmbtu and new infrastructure would be needed. There was existing demand of about 1.5PJ for liquefied petroleum gas (LPG) which could switch if the infrastructure was in place.

Pillay said the cheapest price for LNG that SA could achieve was about $6/mmbtu, but this was linked to the Henry Hub price and was not fixed.

Industrial and transport demand was highly price sensitive, the study found. If the delivered price of LNG rose by $4 per mmbtu, 80% of industry demand would be lost. In transport, 75% of demand would be lost if the price increased by US50c or R7.84 per litre through imposing the fuel levy. The government had to balance the need to grow the gas market with tax revenue considerations.

In several other countries, including Iran, Pakistan and Argentina, full or partial state incentives were needed to boost gas penetration, Pillay said.

Source: Business Live

Related

Tags: GasKarooKishan PillayLNGmethaneMozambiqueshale gasSouth AfricaSouth Africa Department of Trade and Industry officialモザンビーク南アフリカ南非莫桑比克
ScanSendShare365Tweet228Share64Pin82Send
FurtherAfrica

FurtherAfrica

Founded in 2015 FurtherAfrica is an online platform centralising news and content focusing on the development and growth story of the African continent.

Related Posts

Energy

Towards Africa’s US$1.5 Trillion green hydrogen economy

by Energy Capital & Power
February 6, 2023
Fintech

Morocco’s rocky crypto journey

by Web3Africa
February 6, 2023
The Forbes Billionaires’ list: Africa’s richest people 2022
Private Equity

Adenia Capital (V) gets 75% of its target size at first close

by Africa Global Funds
February 6, 2023
Energy

Angola and Belgium talk renewable energy cooperation

by FurtherAfrica
February 6, 2023
Ghana holds key interest rate in the face of inflation pressures
Economy

List of companies ordered by Ghana to pay back-taxes grows

by FurtherAfrica
February 6, 2023
Platform Africa 2023
 
Mozambique eVisa
 
MozParks
 

Translate this page

Read the Latest

Energy

Towards Africa’s US$1.5 Trillion green hydrogen economy

by Energy Capital & Power
February 6, 2023
0

A new study, titled, ‘Africa’s Extraordinary Green Hydrogen Potential,’ conducted by the European Investment Bank (EIB), International Solar Alliance and...

Read more

Morocco’s rocky crypto journey

February 6, 2023
The Forbes Billionaires’ list: Africa’s richest people 2022

Adenia Capital (V) gets 75% of its target size at first close

February 6, 2023

Angola and Belgium talk renewable energy cooperation

February 6, 2023
Ghana holds key interest rate in the face of inflation pressures

List of companies ordered by Ghana to pay back-taxes grows

February 6, 2023

FurtherAfrica Partners Network

The Exchange Club of Mozambique Taarifa Rwanda
TechGist Africa Africa Oil & Power Farmers Review Africa
Tanzania Invest Zambia Invest See Africa Today
Africa Global Funds Novafrica CrudeMix Africa
Harambee Africa Botswana unplugged Financial Insights Zambia
O Económico Digilogic Africa Web3Africa

Subscribe to FurtherAfrica

Enter your email address to receive new articles on your email.

Join 100,773 other subscribers.
FurtherAfrica

© 2021 FurtherMarkets

FurtherAfrica is a FurtherMarkets Limited platform

  • Countries
  • Interviews
  • Understanding
  • Videos
  • Travel
  • Weekend
  • About

Follow Us

No Result
View All Result
  • Countries
    • Angola
    • Botswana
    • Cape Verde
    • DRC
    • Eswatini
    • Ethiopia
    • Kenya
    • Malawi
    • Mauritius
    • Mozambique
    • Namibia
    • Nigeria
    • Rwanda
    • South Africa
    • Tanzania
    • Uganda
    • Zambia
    • Zimbabwe
  • Interviews
  • Understanding
  • Videos
  • Travel
  • Weekend
  • About

© 2021 FurtherMarkets

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?