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Libya: With Fiscal Terms Amended, ENI Takes $8Billion FID on Structures A& E

By Muhammed Jetutu, in Cairo

After years of delay and drawn-out negotiations over fiscals, Italian major ENI has, with Libya’s National Oil Corporation, NOC, taken the Final Investment Decision to develop the Structures A&E, the country’s first major project since the early 20-noughties.

It involves development of two gas fields – the A and E structures – located in contractual area D, offshore Libya. First gas from the two clusters is targeted for 2026 and will reach a combined plateau production of 750Million cubic feet per day (750MMscf/d).

Structure A is located in the central part of Block NC41, approximately 75 kilometres from the Libyan coast in a water depth of between 93 and 145 metres. Structure E is sited in the central-eastern part of Block NC41, approximately 125 kilometres from the Libyan coast in a water depth of between 205 and 235 metres.

ENI has been in talks with NOC over the development for 15 years and, with political and security challenges in Libya in the last 12 years, the Italian firm’s enthusiasm had waned. The decision to finally go ahead was determined over meetings at which far reaching fiscal terms were negotiated and agreed between the two parties in August 2022.

Structure E platform will handle output from 23 wells — including five subsea wells — with 600 MMscf/d of gas and 30,000 Barrels Per Day (BPD) of liquids sent via two pipelines to a facility at Mellitah on the coast. Meanwhile, some 160 MMscf/d of gas plus 12,000BPD of liquids from the eight-well Structure A wellhead platform is due to be exported to ENI’ss existing Sabratha platform via a multiphase pipeline

The Fiscal Terms

NOC presents, in detail, the history of the meetings that took place between the representatives of the company and those of ENI. “In the first meeting on 24 August 2022 with ENI’s management, NOC called on ENI to implement the project. ENI had initially slowed down (the stages of implementation) due to political and security concerns. After several meetings, ENI accepted and asked for an agreement to be reached first to determine the costs”. Subsequently, “the company asked to change the cost recovery rate from 40 to 45 percent and a negotiating team was created (…)”. The parties “agreed to change the percentage (of cost recovery) from 40 to 38 percent, which decreases to 37 percent if the value of the project costs is within $7Billion and rises to 39 percent if it exceeds $8Billion.” Furthermore, as foreseen, the percentage is “30 per cent after ten years from the start of the implementation project”. The NOC reiterates that the percentages relate to the recovery of implementation costs and “not to the sharing ratio”. In addition, the NOC specifies that the “exploration expenses for offshore plants A and E, equal to $1.2Billion, were fully recovered before the project was implemented”.

THE FIELDS’ DEVELOPMENT will centre on two main platforms tied into the existing treatment facilities at the Mellitah Complex. The project also includes construction of a carbon capture and storage (CCS) facility at Mellitah, allowing a significant reduction of the overall carbon footprint, in line with Eni’s decarbonisation strategy.

NOC says that the project needed to be immediately implemented for a variety of reasons:  “Gas production in the Al Wafa and Al Salam fields will start declining in 2025 by more than 440Million cubic feet per day, which will lead to a shortfall in the supply of gas for domestic consumption and, if this loss is not compensated with investments and increasing production, the Libyan state will be forced to import gas to power gas-fired power plants”.

NOC points out that “an investment of $8Billion will once again bring Libya to the fore and will attract investors from the oil and gas sector, which will lead to the progress of the economy, creating many job opportunities and increasing levels of income”. Thirdly, NOC considers that “the return that the Libyan state will obtain from this investment is estimated at $13-18Billion, after recovering capital and operating expenses”. Finally, “the announcement of this project will encourage contracting companies engaged in the exploration of exploration blocks, onshore and offshore, to start their activities”.

This story is a slight update from the article that appeared in the December 2022 edition of Africa Oil+Gas Report

 


Africa Will Gain 11% Share of Global Gas Supply by 2050, a New Report Says

…It is the only region where gas production growth will more than double

A hefty sum of $9.7Trillion  is required for investment in upstream projects between now and 2050, if the rise in the world’s demand for energy is to be met in that time frame.

As population growth surges with 1.8Billion additional people, mostly in Asia and South Pacific, “energy demand is expected to rise by 22% by 2050”, according to the latest edition of the annual Global Gas Outlook 2050, launched on January 29, 2023 by the Gas Exporting Countries Forum (GECF).

Natural gas trade will expand by more than a third, led by LNG, which will overtake pipeline trade by 2026, the outlook notes.

“Global GDP will more than double, from $95Trillion today to $210Trillion in real term”, the 91 page report indicates. ”Natural gas’ share in the energy mix will go from 23% today to 26% in 2050”, while the supply of the product “will increase by 36%”, the report assures. The Middle East will contribute the largest growth share, accounting for one-third of the total, followed by Africa and North America. North America, the world’s largest gas producer, will maintain its position until the end of the outlook horizon. The region’s natural gas production is forecast to grow by 10Trillion cubic feet (Tcf) to reach 50Tcf by 2050. However, the region’s share will decline from 28% in 2021 to 26% in 2050.

Africa will be responsible for the second-largest volumetric growth, gaining more than 11% share of global gas supply by 2050, compared with slightly more than 6% in 2021. Africa is the only region where gas production growth will more than double, from 9.2Tcf in 2021 to 21Tcf in 2050.

Global natural gas production will continue to rise by an average of 1.1% per annum, from 142Tcf in 2021 to 193Tcf in 2050, representing a total of 36%.

GECF is an intergovernmental organisation established in May 2001, becoming a fully-fledged organisation in 2008, comprising eleven Members and eight Observer Members from four continents. Member Countries include Algeria, Bolivia, Egypt, Equatorial Guinea, Iran, Libya, Nigeria, Qatar, Russia, Trinidad and Tobago, and Venezuela). Observer Members include Angola, Azerbaijan, Iraq, Malaysia, Mozambique, Norway, Peru and the United Arab Emirates.

Although the Global Gas Outlook 2050 was produced by a team constituted by GECF, the organization issues a strong disclaimer: “The data, forecasts, analysis, and/or any other information contained within this document and any attachments thereto are for information purposes only and are provided on a non-reliance basis and any obligation and responsibility is hereby disclaimed with respect to such content”. The GECF declares that t neither itself, “any of the GECF Members and Observer Countries, nor any of their officials, representatives, agents or employees, while fully reserving their rights with respect thereto, shall assume any liability or responsibility for the content of the Documents and any data, analysis, or any other information incorporated therein”.


Expro Wins a Contract for LNG Pre-treatment Facility for ENI in Congo

Expro Group, the New York listed Energy services provider, has won a long-term Production Solutions contract from the Italian explorer ENI for a liquified natural gas (LNG) pre-treatment facility in Congo.

“As initially discussed on the company’s third quarter earnings conference call on November 3, 2022, the 10-year contract is expected to generate more than $300Million of revenue for Expro”, the contractor noted in a press release.

Expro will design, construct, operate and maintain a fast-track onshore LNG pre-treatment facility under a 10-year contract on the ENI operated Marine XII development, located offshore Congo. The facility will be built near the Litchendjili gas plant – which supplies gas to the adjacent Centrale Electrique du Congo (CEC) Pointe-Noire power plant.

The pre-treatment facility will process approximately 80Million standard cubic feet of gas per day (80MMscf/d) and will be tied to one of ENI’s two offshore floating LNG (FLNG) projects, allowing incremental gas production for low carbon electricity generation and enabling the production of LNG to significantly increase from the West Africa area, thereby supporting both the local energy market and increased global demands for LNG.

ENI’s two FLNG projects under development on the Marine XII cluster of fields include (1) 0.6Million tons per annum (MMTPA) capacity project that will utilise the Tango FLNG vessel, with LNG production expected to begin in 2023.  (2) A 2.4 MMTPA FLNG facility under construction by Wison Heavy Industry. The two FLNG projects will deliver 3Million tons/year of LNG, (which is over 159Billion cubic feet/year) in 2025. The 2.4 MMTPA FLNG vessel, a 380 metre long and 60 metre wide unit, will be anchored at a water-depth of around 40 metres and will be able to store around 6.5Million cubic feet of LNG and 1.6Million cubic feet of LPGs. Preliminary activities have already started, with long lead items ordered and steel cut of cryogenic tanks occurred on December 20th, 2022.

 

 

 


FPSO Moves to Site for Senegal/Mauritania LNG Project

Technip Energies has announced the sail away of the Greater Tortue Ahmeyim (GTA) Floating Production Storage and Offloading (FPSO) from China to Senegal and Mauritania.

The FPSO will serve GTA Phase 1 site on the maritime border of Mauritania and Senegal.

The project is based on the development of two offshore gas fields namely Tortue and Ahmeyim. GTA Phase  will produce 2.5Million tonnes per annum (2.5MMTPA) of LNG in its first phase of development for which the final investment decision (FID) was taken in December 2018.

The floating facility measures 270 metres in length, 54 metres in width and 31.5 metres in depth. It is as large as two football fields and is of the same height as a 10-floor building. The FPSO includes eight processing and production modules and can accommodate 140 people on board. The key function of the FPSO is to remove water, condensate and reduce impurities in the gas stream before exporting processed gas to the FLNG facility in Mauritania and Senegal.

Technip Energies claims that it has involved “local companies to execute scopes of the project”., as part of the project local content. “Technip Energies will also integrate local personnel into the subsequent phases of the project. Local engineers and technicians, trained throughout the project development phases, will be involved in the various activities related to mooring, tie-in, commissioning and start-up, holding various positions: pre-commissioning, commissioning, Quality, HSE and logistics”.


‘Utorogu LPG Project with Southfield Still on Course’, NCDMB Pronounces

The Nigerian Content Development & Monitoring Board (NCDMB) has dismissed any misgivings about “the quality” of the proposed agreement among would-be partners in the planned production of 123,000 metric tonnes per annum of Liquefied Petroleum Gas (LPG) from the Utorogu gas and condensate field, onshore western Niger Delta. The board also throws its weight behind the “credibility” of the project sponsor

The (NCDMB) had recently reported it had secured the approval of its Governing Council for a partnership to produce 123,000 metric tonnes per annum of LPG, which is about 10 percent of the country’s current consumption, from the Utorogu Gas Plant. That would mean a partnership between that company on one hand and NPDC and ND-Western, joint operators of the Oil Mining Lease (OML) 34, where the Utorogu field is located.

But the feelers from the industry is that Southfield Petroleum, this same company proposing the Utorogu project had fallen out with Seplat, over a similar proposition and the Seplat management was so angered by the course of events it took the company to court for redress after the company had itself taken Seplat to court, allegedly for breach of contract.

What is the issue? “The deal broke down because they (Southfield) didn’t even show up to build any facility, let alone receive the gas”, Seplat insiders say.

Now that Southfield is in discussion with ND-Western over a similar project, Africa Oil+Gas Report asked the NCDMB  if the board was “sure of them” (Southfield)?

Here is the response from Simbi Wabote, NCDMB’s Executive Secretary:

“Southfield Petroleum is a company we are partnering with in order to produce LPG within the Utorogu field. The company is currently in discussion with the a joint venture partners operating Utorogu gas plant, who are ND-Western and NPDC. Before the project will go ahead, they will be sure that there is gas availability and then that commitment has to be on the table. Where we are at now is the Front-End Engineering Design (FEED) for the project itself; but before we will beat our chest that we have secured that project, we’d ensure that all the i’s are dotted and the t’s are crossed.

“It is within the project development funnel and one thing we must understand about investments in general today is that, if you go and speak to Elon Musk and ask him about how many businesses did he invest in and he didn’t succeed, he will probably give you a catalog of what he tried and he didn’t succeed at, but with the ones he succeeded at, he is where he is today. Talk to Bill Gates, talk to Zuckerberg, nobody can tell you that every Investment they’ve been into was a success and that’s the challenge we have in Africa. The averse appetite for risk-taking is even in us as a people. You know about  the sense of adventure of Caucasians, you have to think and ask yourself: How many Africans will want to go and climb Kilimanjaro? How many Africans will want to enter the sea and swim with a shark or with a Whale? These are risks that people take in other to understand nature and these are serious risks. But send an African, particularly in Nigerian man, he will hardly want to take any risks as it were”.

The full interview with Mr. Wabote, over a range of issues, was published in the November 2022 issue of Africa Oil+Gas Report monthly. A summary of that interview will be available on this website next week.

 


North Africa’s Domestic Gas Market Is Larger than its Export..And It Dwarfs Subsahara’s

It is true: Libya directs about 60% of its gas production to the domestic market, while the rest is exported to Italy, according to statistics from the Libyan Ministry of Oil and Gas.

That piece of information will give Nigeria’s natural gas producers some pause; it’s an epic struggle to find credible natural gas offtakers in Africa’s largest economy.

Egypt utilizes five times more of its natural gas in-country than it exports. Algeria’s natural gas export is only slightly higher than its domestic utilization. These two countries; the largest producers of natural gas in Africa, are faced with the kind of challenges that the Nigerian government would consider a good problem: how to reduce the appetite for gas at home so as to have more gas to export for foreign exchange?

“Controlling domestic natural gas consumption is a key issue, as potential gas savings can be exported”, Toufik Hakkar, CEO of Sonatrach, the Algerian state hydrocarbon firm, told the MEES. “Growth in gas consumption in Algeria recorded in the past is explained by economic growth and improving citizens’ access to energy, but also through the implementation of several industrial projects that need gas” he explained.

The Egyptian government, in August 2022, moved to limit the country’s use of electricity in order to raise natural gas exports. Government buildings and sports facilities were asked to cut their consumption, including by turning the lights off outside daytime hours; a lower limit of 25°C was put in place for Air conditioners in malls, and retailers were asked to reduce bright lighting in storefront. The government hoped the measures would make available some 15% of the gas that is currently allocated to the nation’s gas-fired power stations, which delver over 40,000MW of electricity. The curb was meant to bring in an extra $450Million a month in revenues. Price increases on natural gas supplied to cement producers and brick kilns came into effect in October 2022, in another move to dampen domestic demand and redirect more gas for export. And the country’s burning of mazut fuel oil in power stations soared to a five-year high

So, what are the figures? What really, are the domestic gas volumes in these countries?

In Egypt, around 7Billion cubic feet of gas is marketed every day, of which 6Billion is sold in the domestic market. Nigeria’s sales in the domestic market is less than a quarter of that, and yet Nigeria is the biggest domestic gas market in Subsaharan Africa, followed by South Africa, which consumes less than 600Million cubic feet a day. For several years the Egyptian government reduced the gas nominated for the country’s two Liquefied Natural Gas facilities, until there was no molecule of gas left to liquefy for export. In 2014, BG (now defunct), famously lamented that it was breaking contracts with customers and lenders because it was unable to export enough liquefied natural gas from Egypt, its largest producing area. Reason: the exports were curtailed because the Egyptian government had ordered the diversion of the company’s natural gas production to domestic purposes.

In 2021, the latest year for which reliable figures are available, Algeria exported 6Billion cubic feet per day of both LNG and piped gas, mostly to Europe. At home, it consumed about 5Billion cubic feet of natural gas per day. Sonatrach’s 2021 report said that the domestic consumption was largely determined by demand from three large national companies:• Sonelgaz • Fertial • Sorfert.

Libya is the small one, but its story fits the pattern. It exports around 250Million cubic feet per day to Italy, but it consumes 375MMscf/d in its power plants and industries. For all of 2022, Libya exported about 88Billion cubic feet of gas through the Green Stream pipeline to Italy. At home it consumed 132Billion cubic feet.

Nigeria is the largest domestic gas market in sub-Saharan Africa; its gas export has significantly dropped in the last two years, but at the best of times its export was about 3.5Billion cubic feet per day, while the domestic consumption was never as high as 1.5Billion cubic feet per day. Which means that, neither the export nor the domestic volumes were up to scratch compared with the two largest North African economies.

Yet, the most vociferous arguments about how gas should be the transition fuel (in the journey to a zero-carbon future) has been the African countries south of the Sahara, who, in most cases don’t have clear line of sight to robust domestic gas markets even in the next decade.


Gas Flare Programme: 139 Applicants Make It to RFQ Phase

The Nigerian Upstream Regulatory Commission (NUPRC) has rated 139 applicants as “deemed successful and awarded the Qualified Applicant status”, for the Request For Qualification (RFQ) Phase of the Nigerian Gas Flare Commercialisation Programme (NGFCP) 2022

This is less than 50% of the Three Hundred (300) companies who registered their interest to revalidate their prequalification status and submit Statement of Qualification (SOQ) as existing bidders and new participants, respectively.

The Commission says that in consideration of Section 105 (2) of the PIA and similar provisions enabling the Commission in that respect, it “hereby publishes the list of Qualified Applicants who will proceed to the Request for Proposal (RFP) phase of the NGFCP 2022.”

The 139 “Qualified Applicants” will now follow through with the subsequent stages of the Programme towards becoming a Permit Holder/Flare Gas Buyer in line with the applicable statutes.

47 gas flare sites are on offer with a total potential output of about 250Milion standard cubic feet of gas per day guaranteed for five years. 14 of these sites can deliver between 0.5 to 2Million standard cubic feet per day (MMscf/d); 19 sites can do 2.1 to 5MMscf/d; nine (9) can produce between 5.1 and 10MMscf/d and five flare sites can produce over 10MMscf/d.

25 (or 53%) of the flare sites are located on land; eight (8) in swamp; 13 in shallow water and one in deepwater.

The NGFCP 2022 seeks small/mid-scale modular technologies and its unique features includes ease of deployment, scalability, mobility, and off-theshelf availability including: • Mini/mid-scale LNG, • Modular LPG facility, • modular methanol/ammonia plant, • Gas-to-liquids facility, • Virtual pipeline solutions. The proposed solution(s) must cater for the full stream of the flare gas composition

In the next phase of the process, which is Request for Proposal (RFP) phase gas composition will be a part of the flare dataset which will be made available in the data room. Typical flare gas composition shows methane content of 70-90% which makes the sites amenable to mini-LNG deployments NUPRC officials assure. Many of the flare sites are not necessarily connected to pipeline infrastructure, but basic (financial and technical) requirements are provided in the Request for Qualification (RFQ) and detailed information will be enumerated in the RFP when issued, regulators have assured.

The NUPRC says there are no base formula for license fees rather there are fixed fees which are categorized based on range of volumes.

Pricing is always a key issue in gas offtake. Questions have been raised about whether any additional flare gas produced by the field above the licensed quantity may be priced at Henry Hub. To this, the NUPRC has responded: “If available, additional flare gas offtake by Flare Gas Buyer (FGB) over and above the contracted flare volume will be priced at the bid price offered by the FGB as contained in the Gas Sales Agreement (GSA)”.

The NUPRC promises it would “implement a streamlined regulatory licensing and permitting processes to facilitate project development”. It promised that Flare is made available under the NGFCP to a Flare Gas Buyer on an “As is Where is” basis. “The Commission shall exercise best endeavor to ensure that the forecasted quantity is made available by the producers”.

Any carbon credit accruable, the NUPRC explains, will be managed in line with the established protocol on carbon credit.

All Qualified Applicants shall receive further communications via their respective contact addresses and the NGFCP portal (ngfcp.nuprc.gov.ng) accordingly.

 


Mozambique to Legalize Village Militias to Fight Terrorists in Gas Rich Province

The Mozambican parliament has passed the first reading of a government bill that will legalise the “local forces”, which are village militias in the northern province of Cabo Delgado, set up to fight against Islamist terrorists.

Terrorist attacks in Cabo Delgado began in October 2017, and have been characterized by great brutality, including beheadings, mutilations and rapes. As from 2019, rather than rely exclusively on units of the defense and security forces, some villages began to set up their own self-defence units, initially drawn largely from veterans of Mozambique’s war for independence from Portuguese colonial rule.

The government bill makes it clear that the “local forces” are not independent, but fall under the control of the regular armed forces (FADM), which will provide them with logistical support. Introducing the bill, Defence Minister Cristovao Chume said the military chain of command covers the local forces, which are a temporary expedient arising from the crisis of jihadist terrorism.

Local forces began as an offshoot of the veterans of the independence war, the Defence Minister says in a statement. Today, they include many young people determined to defend their villages, and even some demobilized soldiers who had once been members of the main opposition party Renamo.

Both Renamo and the Mozambique Democratic Movement (MDM), the second opposition party, denounced the bill, claiming that it legitimizes a “parallel” paramilitary force, serving the ruling Frelimo Party.

Renamo deputies repeatedly declared that the bill “legitimizes naparamas”. In fact, the bill does not mention the naparamas, which are an independent peasant militia, quite separate from the local forces.

The naparamas first appeared in the late 1980s, fighting alongside the Mozambican army against Renamo, and, for a few years, enjoying considerable successes in Nampula and Zambezia provinces. They reappeared a few months ago to fight against the jihadists in Cabo Delgado. It is not at all clear that the naparamas would disband, even if the government told them to.

Renamo and the MDM argue that the local forces are “unconstitutional”, because the Mozambican constitution states that defence matters are exclusively the domain of the armed forces and the police.

But the government’s bill deals with this problem by bringing the local forces explicitly under the control of the FADM. Indeed, if the bill is not passed, the situation of the local forces would clearly become unconstitutional.

Neither Renamo nor the MDM suggested disbanding the local forces. Instead, they argued that they could be replaced by reservists, or by recalling demobilized soldiers into the FADM.

In the vote, the 161 members of the ruling Frelimo Party present supported the bill, while all 56 Renamo and MDM deputies in the room voted against.

The bill now enters a committee stage, where amendments can be proposed, but it is unlikely to undergo any significant change. The second and final plenary reading of the bill will occur on Friday or Monday


ENI Tops Up Congo’s FLNG Capacity By 300%

By Sully Manope, in Brazzaville

Project will deliver ~440MMscf/d by 2025

Italian producer ENI has launched a second Floating Liquefied Natural Gas (FLNG) project to increase the production of and export from the Republic of Congo.

The company announced it had signed a contract with Wison Heavy Industry for the construction and installation of an FLNG unit with a capacity of 2.4Million Metric tons per annum (2.4MTPA). The FLNG will be deployed offshore the Republic of Congo, widely known as Congo Brazzaville.

This facility will be the second FLNG to be deployed in the country, the first one being Tango FLNG (0.6 MTPA capacity), with LNG production expected to begin in 2023. With the second FLNG, overall LNG production capacity on the Marine XII field will reach 3Million tons/year (3MTPA), which is ~160 Billion standard cubic feet/year or 440MMscf/d in 2025.

The 380 metre long and 60 metre wide vessel will be anchored at a water-depth of around 40 metres and will be able to store over 180,000 cubic meters of LNG and 45,000 cubic meters of LPGs. Preliminary activities have already started, with long lead items ordered and steel cut of cryogenic tanks occurred on December 20th.

“Both initiatives are part of Marine XII gas valorisation plan, in line with ENI’s strategy to leverage gas equity”, the company says in a statement.

 

 


TOTAL Reduces Scope of South African Gas Project, Excludes ‘Marine Protected Areas’

French major TOTALEnergies has voluntarily reduced the scope of the license application for natural gas production offshore South Africa, the company says in a response to environmental activist groups.

TOTAL says it has done so “by excluding the area currently classified by the South African authorities as a protected marine area”.

The company did not disclose how much of the natural gas volumes will be impacted by the curb, or what shape the scope reduction will take.

Application for production licence for Block 11B/12B in the deepwater Outeniqua Basin, 175km offshore off the coast of the Western Cape, was made on September 5, 2022, three years after TOTAL discovered massive deposits of gas and condensate in the block with the Brulpadda-1 well, drilled in 2019.

In October 2022, Netherlands based The Bloom association for the protection of the oceans and the South African non-governmental organization (NGO), The Green Connection, launched an international petition against the development of the Brulpadda-Liuperd project, which is primarily intended to supply 200Million standard cubic feet per day (200MMscf/d) to a Gas to Liquids (GTL) Plant operated by the state hydrocarbon firm PetroSA, in Mossel Bay in the Western Cape.

“I can confirm that TOTALEnergies EP South Africa and its partners applied for a production license on September 5, 2022 following which an environmental and societal impact assessment was initiated, in accordance with South African regulations”, Patrick Pouyanne, the CEO wrote in a letter responding to Bloom and The Green Connection. “This assessment will provide a detailed description of the project’s economic, social and environmental impacts, the measures planned to preserve the environment, and the related social and economic benefits. A survey has been launched to map the marine species, including, potentially, marine mammals, to model the potential impact of production activities (especially noise) and to define any measures to be taken”, Pouyanne wrote.

“I would also like to stress that TOTALEnergies E&P South Africa has already voluntarily reduced the scope of the license application by excluding the area currently classified by the South African authorities as a protected marine area”, Pouyanne disclosed.

“Under South African regulations, an information and consultation process on the environmental and societal impact assessment is mandatory. The first public meeting will be held in late 2022, and all stakeholders will be invited to participate. Their observations, expectations and concerns will be considered, including through socio-economic development initiatives.

“Concerning the project’s contribution to reducing greenhouse gas emissions, I would emphasize that this project is expected to supply gas to the South African domestic market. South Africa’s economy is still predominantly based on coal, which accounts for 80% of its current electricity generation. Access to energy, and in particular meeting the growing demand for electricity, is a major concern in South Africa, where load shedding and power cuts have been an almost daily occurrence for nearly 15 years and where air pollution from fine particles linked to coal burning is frequent. The use of gas to replace coal combustion for electricity generation halves CO2 emissions and drastically reduces air pollution. The atmosphere will benefit from the avoided emissions made possible by this gas development project”.

Pouyanne’s letter noted that that TOTAL is positioning itself In South Africa “to contribute to the evolution of the country’s energy mix as part of a just transition that will require a move away from coal, a sharp increase in renewable energies, and the use of gas as a transition fuel”.

 

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