DTI upstream and midstream oil and gas industrial development division director Kishen Pillay
Photo by: Duane Daws
The development of a regionally shared vision on developing a gas industry could provide a catalytic opportunity for a regional ecosystem to the benefit of Southern Africa’s economies.
A seamless, integrated and coordinated approach was needed to exploit the maximum regional potential of the opportunities provided across several industries by the fairly new, untapped gas sector.
The greenfield nature of gas industrialisation would enable all stakeholders to provide their inputs into the long value chain from the start, in a properly coordinated manner, creating early consensus on policies, and would allow for collaboration on and coordination of strategies, said Department of Trade and Industry (DTI) upstream and midstream oil and gas industrial development division director Kishen Pillay.
Speaking during a panel session at the Manufacturing Indaba, held in Kempton Park, on Tuesday, he noted that the DTI, considering its mandate, was examining all the opportunities attached to the regional development of gas.
“We view the gas economy as a regional economy,” he said.
The DTI’s recently established gas industrialisation unit (GIU) aimed to create policy certainty and coherence, while closing the gaps and streamlining any overlaps in policies.
The GIU was introduced earlier this year under the eighth iteration of the Industrial Policy Action Plan to ensure natural gas was used as both a source of power generation and a driver of industrial diversification.
This followed major on- and offshore gas finds across Southern Africa, further pointing to the region’s potential as a major oil and gas hub.
“However, the regional context is vastly different from other major petroleum jurisdictions, with political complexities that will require very careful policy development, planning and coordination to unlock the full potential of a regional gas economy – not least because of the lack of developed transportation corridors and gas utilisation infrastructure in the region,” Trade and Industry Minister Dr Rob Davies said at the time.
The GIU aimed to facilitate shared and collaborative regional development, as well as industrial development and integration, Pillay noted.
South African Oil and Gas Alliance CEO Niall Kramer added that there was a need to map out the types of industries that could be stimulated or developed on the back of excess imported gas not used for the 3 GW allocated by the Department of Energy for gas-to-power use, for instance.
A review of the opportunities across the board would determine which sectors would “make the most sense” for the relevant countries’ economies.
“This is not so much about developing gas as an industry . . . but [rather] an ecosystem,” he commented.
JSK Consulting MD Doug Kuni pointed to the need for a number of anchor projects strategically placed along South Africa’s coast to unlock the deployment of infrastructure for gas distribution for use in other sectors of the economy.