Oil And Gas Exploration At ‘All-Time High’ Off South Africa

Oil And Gas Exploration At ‘All-Time High’ Off South Africa

High oil prices and recent large gas finds off Mozambique and Tanzania have whet the appetites of an unprecedented number of companies exploring for oil and gas off South Africa’s coast, according to a report in IndependentOnline.

Twenty companies, including Shell, Anadarko, ExxonMobil and Total, are involved in exploration, said Petroleum Agency SA.

Surveys that map the ocean floor are the first stage of offshore oil and gas exploration. In the past year, eight seismic surveys of the seabed have been conducted by companies looking for oil and gas around South Africa’s coast compared to the average one per year in the past, said David Van der Spuy, resource evaluation manager for Petroleum Agency SA.

“This is a position that South Africa has never been in before,” Van der Spuy said. “If encouraged, the companies could sink test wells in about 18 months to three years.”

High oil prices make exploration viable, he said.

Will Barker, managing director of Australian oil and gas company Sunbird Energy, told a meeting of the Cape Chamber of Commerce that Sunbird was investing in South Africa because gas would play an increasingly important role in Australia’s energy mix.

Sunbird has partnered with PetroSA, the national oil company (NOC) of South Africa, in trying to buy rights to operate and develop the large Ibhubesi gas field off the West Coast. NOCs are oil companies fully or majority-owned by governments.

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Gas had been found in seven of 11 test wells sunk at Ibhubesi, the report said. Barker said it’s the largest undeveloped gas field in South Africa. This “suggests a high probability rate for further discoveries,” he said.

Sunbird is considering building a 400-kilometer pipeline to transport gas from Ibhubesi to Ankerlig Power Station near Atlantis in the Western Cape, Barker said.

About 85 percent of South Africa’s electricity comes from coal. South African electricity public utility Eskom is considering converting its power station from diesel to gas in 2016. Ankerlig is designed to run on gas if large quantities are found in the Western Cape, Eskom said.

South Africa’s only commercial gas operation is in Mossel Bay, a harbor town of about 30,000 people on the Southern Cape’s Garden Route. The town’s economy relied on farming and fishing until the 1969 discovery of natural offshore gas fields led to the development of a gas-to-liquids refinery operated by PetroSA.

Although PetroSA is digging new wells in a new field, deposits in the two main gas fields, first tapped in the 1980s, are starting to run down, Van der Spuy said.