The American and Israeli war on Iran has warmed hearts in the South African oil and gas lobby. In their eyes the war and its effect on the oil and petroleum markets are a great “opportunity”.
In Business Day last week Dustin van Liew and Adrian Strydom argued our energy sovereignty is no longer negotiable (“Volatility is the new normal”, April 9). We need to exploit oilfields in our waters, frack the Karoo and get moving on that gas master plan so we don’t fall over the coming “gas cliff”, no matter how distant it regularly becomes.
Van Liew is a senior vice-president of Energeo, a global trade alliance based on energy “geoscience” (PR speak for fossil fuels). Strydom is CEO of the South African Oil & Gas Association.
“Developing a domestic oil and gas sector is one of the potential safeguards against the geopolitical shocks that dictate South African inflation,” they argued. “By unlocking local offshore and onshore resources, South Africa does more than fuel the economy. It creates a strategic buffer.
“A localised energy value chain ensures the industrial and transportation sectors are powered by a predictable indigenous supply largely shielded from the volatility of foreign conflicts.”
Having your own oil is no panacea for poor government, though. Nigerians, Angolans and Venezuelans would attest to that. Where oil is produced in sophisticated or sparsely populated economies, oil prices can indeed be lowered through subsidies. But even if we struck oil or gas offshore this morning, it would take more than a decade for it to get into your tank.
That’s if you’re not driving an electric car by then. A Chinese producer just landed a vehicle in South Africa that can do 1,000km on a single charge. What will the petrol market here look like in 2040? And will trucks never run on hydrogen, which you make literally with water, or on batteries? Technology and AI are going to make fools of modest economies and commercial adventurers trying to imitate today’s industrial giants.
Just because it’s expensive now, do we forget the future and prepare instead for more oil? We would have to upgrade or replace all our refineries, build new oil and gas terminals and pipelines for “our” crude and liquefied natural gas, and try to prevent a small coterie of connected elites from running away with all the tenders and the markets.
I am all for the private sector doing more or less what it likes, provided it doesn’t kill people, but oil and gas only invests where the government invests our taxes. Elon Musk may not be to everyone’s taste, but he’s right when he says it’s obvious that all future energy will essentially be solar and that the sun will “utterly dominate future electricity production”.
Many of the voices here urging Musk on with Starlink are the same people who will roll their eyes reading this article, but we are perfectly placed to skip another generation of expensive fossil fuels. Our current coal resources are huge, and the plant to convert them into electricity is, with good maintenance, durable.
Some new nuclear would be good, but we have ridiculously modest targets for battery power and the state is painfully slow about creating the 14,000km of transmission lines it says the electricity grid needs. That figure has not moved an inch in a decade.
We can’t have everything, so where does South Africa put its money now? Do we seriously, in the year 2026, make a whole new bet on fossils? Donald Trump’s war will soon end and oil prices will fall again, so let’s not chase obsolete fantasies. We have time, and the sun and the wind are free.
People who own land in the UK are paid decent money by the state to host one or more wind turbines on their properties. Imagine the government here having the courage to hand over 2.5-million hectares of its unused land to new farmers who could cover their inexperience with regular payments for the contribution their turbines or solar panels make to the grid. Many thousands of people could directly and measurably benefit, at little cost to the state. It would change the South African game entirely.
Obviously these things are hideously complex, and I don’t blame Van Liew or Strydom and the rest of the fossil crew for trying, but please … Stopping load-shedding doesn’t solve our energy crisis. It merely defines it. With focused political leadership we could establish a far more secure energy future and save ourselves a generation of anxiety.
• Bruce is a former editor of Business Day and the Financial Mail.
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