The development of the Brulpadda and Luiperd gas condensate discoveries off the coast of Mossel Bay, which could attract R1.5 billion worth of investment for the economy, may be a lost opportunity if national government does not offer oil and gas companies the necessary legislative and policy certainty. This was revealed yesterday during a briefing to the Western Cape’s Standing Committee on Finance, Economic Opportunities and Tourism by Total South Africa.
The real possibility for investment at these sites could have a transformative effect on not only Mossel Bay, but the entire Western Cape economy, with an estimated R1-trillion overall return for the economy over the next 20 years.
But we have already witnessed large-scale global companies such as ExxonMobil (USA) and Equinor (Norway) sell their shares in exploration rights in South Africa this year due to the disabling policy environment. Harsh weather conditions and geology issues have already made the development of these wells high risk, and national government’s slow response may see these sites abandoned for lower risk projects elsewhere.
I will therefore write to the national Minister of Mineral Resources and Energy, Gwede Mantashe, to fast-track the reworking and finalisation of the Upstream Petroleum Resources Development Bill which outlines the national government’s position on petroleum resources, and offers Total and other foreign companies wishing to invest in South Africa the certainty that they need. I will also seek clarity regarding elements in the bill, such as royalties and production bonuses.
Investment in the area shows a positive outlook already, as a local company, Afrishore, is one of Total’s logistics suppliers and has several initiatives which include:
- A mentorship program in which it partners young people with experienced individuals in order to transfer skills to the youth and has a particular focus on women;
- The investment of R1.5 million in the development of micro enterprises including three taxi companies and one 100% black female owned enterprise;
- Employment of nearly exclusively residents of Mossel Bay, with 59 of their 60 employees being individuals from the local community; and
- Has trained the only qualified women jettee supervisor in the country.
In order to attract more investment, I further call on the Transnet National port Authority to fast track studies for upgrading the port in order to allow more gas companies to enter the field.
These much-needed initiatives are promising for the development of opportunities and building toward dignity for residents in the province. More stands to be achieved when government partners with industries, local and abroad, to create an enabling environment for job growth.
