Sasol digs deep to create gas hub

Sasol gas pipeline in Mozambique. Photo : Supplied

Sasol gas pipeline in Mozambique. Photo : Supplied

Published May 31, 2016

Share

Johannesburg - South Africa’s integrated energy and chemical company Sasol has started drilling the first of 13 wells in Mozambique as it plans to create a gas-power hub in the southern African country’s Temane area.

The company said yesterday it wanted to increase the capacity of its processing facility in Mozambique amid strong regional demand for the country’s gas.

It said the drilling programme would enhance its upstream base in Mozambique.

Read: Sasol outsources 30% of its IT functions

Sasol has been producing gas from Mozambique’s Temane and Pande gas fields since 2004. The gas is transported through an 865km pipeline to Sasol’s Secunda facility. Senior vice-president for investor relations Cavan Hill said the company had identified South Africa, Mozambique and the US as key markets for its gas development plans.

Sasol said the Mozambican government last year approved its field development plan to build an integrated oil, liquefied petroleum gas and gas project adjacent to the company’s existing petroleum production agreement area, which is where gas from the Temane and Pande field is produced and processed. Speaking at Sasol’s central processing facility, near Inhassoro, Mozambique yesterday, Hill said drilling the well was the phase of the field development plan.

Joint venture

He said this would entail drilling a total of the 13 wells which included one water well and the gas from the facility would be used in a mooted 175 megawatts gas-to-power plant in the area.

The facility, called Central Termia de Ressano Garcia, is a joint venture between Sasol (49 percent) and Mozambique power utility EDM (51 percent).

“The development was planned in tranches. Government approved phase one of the development earlier this year. Now we begin with the implementation,” Hill said.

Senior vice-president for Sasol Exploration and Production International John Sichinga said the planned development would provide a platform for advancing foreign direct investment, boost economic growth and social development in Mozambique and southern Africa.

Sasol’s future plans in Mozambique include drilling in an onshore gas block called Area A, in which Sasol owns 50 percent and is the operator. PetroSA and ENH own 40 percent and 10 percent of the block respectively.

Sasol shares rose 1.57 percent yesterday to close at R487.

BUSINESS REPORT

Related Topics: