Ramokgopa explained that the proposed 5000MW gas-to-power allocation aims to “provide dispatchable electricity when renewable output falls, or demand rises”.
“Gas generation does not absorb surplus electricity. Its contribution depends on flexible operation that allows renewable generation to serve demand during high-output periods and supplies the remaining requirement when that output declines,” said the minister.
Patel reiterated that South Africa’s long-term energy plan calls for decommissioning some older coal plants and building significant gas-fired capacity by 2030.
However, Patel cautioned that this will reduce emissions and improve grid reliability while also increasing gas demand as supply declines.
Estimates suggest natural gas supplies from Mozambique’s Pande and Temane fields will begin to fall after 2028 as production declines.
“I think it’s important to remember that this isn’t just about replacing declining supply; it’s about the country’s long-term economic growth,” remarked Patel.
“South Africa really needs to come up with a gas supply solution that can both meet its immediate needs and fuel the country’s economic growth for decades to come.”
He added that ExxonMobil’s published energy outlook projected that South Africa’s gas demand could more than triple between now and 2050, driven by economic growth, population growth, and a rising standard of living.
Patel said LNG (liquefied natural gas) could play an important role in bridging that gap, as global markets can supply it at scale.
“It’s reliable, with diverse supply nodes, and while there’s still a lot of work to be done, it provides the country a pathway to meet its immediate gas demand and support future economic growth and the power transition as we look ahead.”
In 2024, Eskom and Sasol signed a memorandum of understanding (MoU) to jointly explore and research potential future LNG requirements.
Patel added that ExxonMobil is committed to the country’s growing energy demand and addressing some of the challenges it faces.
Earlier this year, the company came on board as an LNG supplier for the Zululand Energy Terminal in Richards Bay, a joint venture between Vopak Terminal Durban and Transnet Pipelines that is set to be the country’s first LNG terminal, by signing a heads of agreement (HoA).
However, Patel said these investments will only work with a predictable policy framework and alignment among all parties involved.
“A lot of times with long-term investments, the important starting point is policy. Policy needs to establish a framework that’s predictable and stable to enable these long-term investments,” he remarked.
“From there, I think it’s going to take aligned action from the entities and parties involved — government, regulatory, end users, project developers, and investors — so that the required infrastructure, as well as commercial agreements and financing, all move together on the right timeline,” he said in closing.
