By REGINALD KANYANE
6 June 2025 – The Portfolio Committee on Electricity and Energy received a briefing on Wednesday from the Central Energy Fund (CEF), the South African Oil and Gas Association (SAOGA), SASOL and Business Unity South Africa (BUSA) Gas Industry and gas exploitation in the country, on ways to address the “gas cliff” that faces South Africa. The committee emphasised the need for urgent and coordinated action to mitigate the challenge of the impending “gas cliff” that faces South Africa.
The Chairperson of the Committee, Nonkosi Mvana said the “gas cliff” refers to the expected decline in natural gas supply from Mozambique’s Pande and Temane fields by 2028. Mvana said the fields currently provide a significant portion of South Africa’s natural gas needs.
“The looming supply shortage poses serious risks to the country’s energy security, industrial output, and broader economic competitiveness. The committee heard from the stakeholders, among other things, the need to accelerate development of domestic and regional gas resources to supplement declining Mozambican supply.
“This includes challenges with the regulatory environment and policy uncertainty hampering investment in gas infrastructure, and the importance of aligning gas-to-power projects with LNG import plans to create an integrated gas supply solution,” she said.
Mvana said the stakeholders emphasised the requirement for Public-Private Partnerships and innovative financing models to fund critical midstream and downstream gas infrastructure. She said the CEF, which is the entity of the Department of Electricity and Energy outlined its strategic initiatives to secure long-term gas off-takers for LNG importation projects, as well as its financial strategy to fund these capital-intensive undertakings without exacerbating the national debt burden.
“On the one hand, SASOL discussed their plans to utilise methane-rich gas as a bridge solution until LNG becomes available, while also highlighting the technical and pricing implications for industrial users, on the other hand.
“The Industrial Gas Users Association stressed the urgency of the situation, noting that they have a six to nine month window to put the necessary measures in place to avoid the “gas cliff,” said Mvana.
She said the Gas Users Association proposed the creation of a gas aggregator model and public-private partnership structures to facilitate infrastructure development and unlock private sector investment. Mvana said the committee highlighted the importance of time as the country has less than six years to put the necessary measures in place before the “gas cliff” materialises.
“The committee said it will closely monitor progress and will continue engaging with all stakeholders to ensure a coordinated national response,” she said.
The Guardian 