South Africa’s gas supply set to plummet, could trigger economic crisis
- by proamteam
South Africa is facing a looming gas supply crisis that could trigger the country’s next economic crisis. The head of an industry body has warned that Sasol will reduce fuel production from its Mozambique gas fields between 2026 and 2027 as reserves dwindle and reserve more production for its own operations. This could jeopardize between 300,000 and 400,000 jobs at the industrial gas company.
Gas supply constraints will be another obstacle to economic growth due to inadequate national planning. South Africa suffers from almost daily power outages due to insufficient generating capacity, and its ports and freight rail network are precarious due to lack of investment and maintenance.
The chairman of the South African Energy Commission (SAEC) called for urgent action to address the gas supply crisis. He said there were no ready supply alternatives for the time needed and South Africa needed to focus on where the supply was coming from. He suggested importing gas through Mozambican ports or quickly setting up gas facilities in South African ports such as Richards Bay or Koga. He also noted that TotalEnergies’ gas field discovery on the west coast is due to be operational by 2030.
He also said there was a “policy vacuum” in South Africa on how to achieve the energy transition and address supply issues. South Africa needs to clarify its policy direction and ensure it translates into a clear regulatory environment for companies to make investment decisions, he said.
The collapse of South Africa’s national capacity in areas such as power supply and port efficiency has led to a 40 percent loss in the country’s economic growth over the past 15 years, Harvard University researchers said in a report.
South Africa still has time to avoid a gas supply crisis, but needs to act quickly, the country’s energy director said. He said South Africa needed to clarify its policy direction and ensure that it translated into a clear regulatory environment for businesses to make investment decisions.
South Africa is facing a looming gas supply crisis that could trigger the country’s next economic crisis. The head of an industry body has warned that Sasol will reduce fuel production from its Mozambique gas fields between 2026 and 2027 as reserves dwindle and reserve more production for its own operations. This could jeopardize between…