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SADC energy infrastructure integration could lower end-user costs

Cape Town: Countries in the Southern African Development Community (SADC) should look at better integrating energy infrastructure to lower the costs for end-users, South Africa’s Minister of Energy Dipuo Peters said on Tuesday. “It may be more effective to link the region’s pipeline network for gas, as well as petroleum products. These may be more effective interventions than costly investment in road transport tankers and rail road cars,” she said at the 6th Africa Economic Forum under way in Cape Town.

Peters said that Angola currently had the largest gas reserves in the region, with approximately 271.8-billion cubic meters followed by Mozambique (1

27.4-billion cubic meters), Namibia (62.3-billion cubic meters), Tanzania (6.5-billion cubic meters) and South Africa (27-million cubic meters). However, with new gas finds that were reported in 2011, Mozambique was likely to move to the top of this list in the near future. Peter said that these reserves were a positive sign for regional trade and development, and provided a further strategic opportunity to lift the fortunes of the region and the continent.

“We should be asking ourselves and spare some thought on how these resources can be used to best serve sub-Saharan Africa and the entire continent first. As South Africa, with a clear intent of creating a sustainable gas market in our country, we will continue to engage with our sister countries to find the best way of utilising these resources, whilst making the necessary returns on investment.”

Peters added that she believed that the SADC governments should also focus on strengthening their own national oil companies in order to clearly define their position in directing the exploration and use of natural resources in their own countries.

According to Peters, the South African government would itself be completing a 20 year Liquid Fuel Infrastructure Plan before the end of the year and included in this plan was a continuing commitment for the country to increase its own crude oil refinery capability.

“Work that has already been done on our national oil company’s Mthombo project and other related initiatives will be incorporated in the implementation of the Liquid Fuels Infrastructure Plan,” she said.

She also noted in her speech that, with crude oil prices continuing to be higher-than-expected, she would “soon make a statement in Parliament about this matter, specifically on the impact of global fuel prices and how we should respond to these as a country”.

With South Africa becoming a significant importer of fuel, having brought over five-billion litres of diesel and petrol into the country in 2011, Peters commented that this increase had far-reaching implications for the existing policy frameworks. “I am of the view that the Department of Energy needs to conduct a review to determine whether the pricing framework is still relevant given these changing conditions,” she said.

Date: 
7 March 2012
Author: 
Jean McKenzie
Source:
Engineering News
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