The government is seeking to expand the focus areas of the second phase of Operation Vulindlela to include oil and gas exploration, ahead of the 2027 deadline when Sasol will stop supplying natural gas from Mozambique.
Sasol also supplies methane-rich gas produced at its plant in Secunda to KwaZulu-Natal and Mpumalanga via the Lilly and SWM pipelines.
Electricity and energy minister Kgosientsho Ramokgopa held a government-to-government discussion with Qatar about a potential supply agreement, adding to the memorandum of understanding with Eskom and Sasol agreeing to collaborate on the supply of LNG supply opportunities in SA to avoid the gas cliff.
Failure to find a solution ahead of the deadline could result in devastating consequences, including job losses, when the current supply runs out. Many industries such as food, chemicals and steel, rely heavily on gas.
“The cabinet directed OV [Operation Vulindlela] in consultation with relevant line departments to consider additional reforms focus areas in re-industrialisation and localisation, to unlock infrastructure build, and the oil and gas sector and exploration,” minister in the presidency Khumbudzo Ntshavheni said in a post-cabinet media briefing on Thursday.
“The cabinet noted that SA remains the eighth country with the largest reserves of gas and the impending gas cliff requires the country to build self provisioning capacity in gas.”
The second phase of Operation Vulindlela, a joint initiative of President Cyril Ramaphosa’s office and the Treasury created in 2020 will focus on local government, spatial inequality and digital transformation.
Operation Vulindlela’s first phase ticked off more than 90% of the items on its original list, among them the auction of digital spectrum and regulatory changes to enable private electricity generation and create a competitive energy market as well as clearing the water licences backlog and reforms to the rail and port system and visa regime.
In the next four weeks, thecabinet will hold a special meeting focusing on devising an economic growth plan, Ntshavheni said.
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