Oil and gas

Logistics companies are signing up for gas.

Image: BHIT Bulk Logistics

The Virginia Gas Project is making good progress. The project is owned by Tetra4 which is a Renergen company. The company has invited bids for the allocation of liquefied natural gas (LNG) and expects to start drilling in 2020. Tetra4 holds the rights for onshore petroleum production, the only such licence in the country which is issued by the Department of Mineral Resources and Energy through Petroleum Agency South Africa.

Renergen intends equipping filling stations with LNG at strategic locations across South Africa to cater for the logistics industry. The first two such stations will be Total stations in Johannesburg and Durban that will be rebranded in green. One station is planned for Harrismith on the busy N3 highway which links these two cities.

Bulk Hauliers International Transport (BHIT) has signed an agreement to take LNG to fuel 50 of its trucks, which should lead to lower operating and maintenance costs. South African Breweries is another client. Tetra4 has a R218-million loan from the Industrial Development Corporation to build a 107km pipeline network from Virginia and the Overseas Private Investment Corporation (OPIC), an agency of the US government, will lend Renergen $40-million (more than R600-million) over 12 years to build a gas plant in the Free State. The area around Virginia has proven reserves of 25-billion cubic feet.

The chemical complex at Sasolburg is the economic driver of the oil and gas sector for the province. One of the Sasol companies at Sasolburg, Sasol New Energy, is moving the group away from reliance on fossil fuels. In 2020 Sasol called for bidders to construct an embedded 10MW solar PV facility at Sasolburg. The company’s larger goal across all its sites is eventually to procure 600MW of renewable energy and achieve a 10% greenhousegas (GHG) emission reduction by 2030.

The regulator and promoter of oil and gas exploration in South Africa, Petroleum Agency South Africa, has awarded coalbed-methane-gas exploration rights in KwaZuluNatal and natural gas exploration permits in the Free State. Early surveys suggest that the Free State has 23-billion cubic feet of gas underground. If this is confirmed, then four new power stations could be built in the province. Tests have begun in the Karoo in search of shale gas.

The Natref fuel refinery is one of only four in South Africa, and the country’s only inland refinery. The refinery is a joint venture between Sasol Oil (63.6%) and Total SA (36.3%). It is a technologically advanced facility, which refines heavy crude oil into petrol, diesel, commercial propane, jet fuel and bitumen. ■

Online Resources

Petroleum Agency SA: www.petroleumagencysa.com South African Oil and Gas Alliance: www.saoga.org.za South African Petroleum Industry Association: www.sapia.co.za Sector Insight Filling stations offering liquified natural gas are planned.