South Africa 
South Africa consolidates role as major energy producer

afrol News, 4 September - South Africa, although a major oil importer, has consolidated its role as a major energy producer and exporter in southern Africa over the last years. South Africa remains the world's second biggest coal exporter worldwide and increased its electricity exports to neighbour countries. Now, oil recoveries are started to get exploited.

According to the last South Africa country report published by the US govt agency Energy Information Administration (EIA), energy production and exports are growing faster than other parts of the South African economy over the last years, giving the sector increased weight.

Coal remains the primary fuel produced and consumed in South Africa and is one of the country's largest sources of foreign exchange. In fact, South Africa is the world's sixth largest coal producer and the world's second largest net exporter, with most of its production exported to Europe. 

South Africa's coal industry was however still giving little back to the country's majority population. Over 80 percent of South Africa's coal is produced in Mpumalanga Province, which remains among the poorest regions of the country. A major reason behind this seemed to be the ownership structure; the "mining industry is still predominantly White-controlled," as EIA puts it. Emphasis had however been placed on "stimulating Black-owned companies in the coal industry, as well as throughout the energy sector as a whole."

While coal has been mined in South Africa since 1857, more modern energy sources are increasingly becoming important. South Africa has now developed a highly advanced synthetic fuels industry, which takes advantage of the country's abundant coal resources and domestic and Mozambican offshore natural gas. Electricity production is of regional importance.

The parastatal company Eskom - one of the largest utilities in the world - generates nearly all (approximately 95%) of South Africa's electricity. Eskom's generating capacity is the forth largest of the world, according to the company, which calls itself "Africa's powerhouse". In addition to serving the domestic market, Eskom therefore also increasingly exports power to Botswana, Lesotho, Mozambique, Namibia, Swaziland and Zimbabwe. Eskom further was expanding its involvement across the continent, in particular Nigeria and Zambia. 

The EIA report leaves no doubt that South Africa's energy industry is a still expanding sector. With the recent development and exploitation of its own reserves of conventional oil, South Africa is currently opening yet another chapter in its energy-related economic history.

Oil exploration efforts are currently concentrated on South Africa's western and southern coasts. There have also been made several offshore natural gas discoveries. "South Africa's recent offshore success is sparking interest in further developments," EIA observes.

South African energy companies further are expanding their activities throughout the African continent. While the South African electricity parastatal dominates the southern African market, South African oil and gas companies increasingly take ownership in other African fields; from Equatorial Guinea to Mozambique. A planned 865-kilometer gas pipeline from Mozambican offshore gas fields to South Africa further demonstrated the expansion. 

Sources: Based on EIA, Eskom, SA govt. and afrol archives

© afrol News.    You can contact us at mail@afrol.com