Africa Energy has sung the praises of an early production system (EPS) plan to develop gas discoveries offshore South Africa.
The company has a stake in Block 11B/12B, which TotalEnergies operates. The companies have made discoveries at Brulpadda and Luiperd, on the Paddavissie Fairway.
Africa Energy president and CEO Garrett Soden noted the existing discoveries and the potential for more exploration.
“We look forward to TotalEnergies concluding gas price negotiations with the government and applying for a production license by next September,” Soden said. The comments came in Africa Energy’s posting of its third quarter results.
An EPS on the block would deliver first gas and condensate production from the Luiperd find. The plan would see gas going to existing customers in Mossel Bay. PetroSA has an under-supplied gas-to-liquids (GTL) plant in the area, which would benefit from additional resources.
Africa Energy said an EPS would “significantly decrease” spending to reach first production. Development of the wider Paddavissie resource would come as the local market for gas expands.
Petroleum Agency SA (PASA) CEO Phindile Masangane, speaking in October at a SAOGA webinar, said there was a “real risk” the GTL plant may close down. The facility accounts for 1,200 direct, and 3,000 indirect jobs, she said.
Closure of the plant would have a “devastating impact”. She went on to say that the offshore discoveries offered an opportunity for affordable supplies to the local market.
“We expect an application [from TotalEnergies] to the regulator for the production right before the end of the year. We have impressed on them that gas is of value,” Masangane said. South Africa would want to see first gas by 2025, she said.
Exploration
The partners have shot 2D seismic on Block 11B/12B, receiving data in September 2020. Africa Energy said the data, provided by Shearwater, found multiple prospects and leads.
PGS and Polarcus shot 3D seismic on the block, providing results in the first quarter of 2021. Where Shearwater’s work focused on Kloofpadda, the 3D was on the Paddavissie.
There are “multiple prospects” in the greater Paddavissie, Africa Energy said.
The company is also involved on a smaller-scale plan in South Africa’s Block 2B. It farmed out an interest in the block.
Soden said Azinam was due to deposit funds in an escrow account, and contract a rig, by the end of the year. The licence on the block expires in November 2022, putting a hard limit on drilling the well.
Azinam is in negotiations with rig contractors.
The partners have pushed the well back before. There had been a plan to drill it in 2020. In April, Africa Energy set out plans to drill the Gazania-1 by the end of 2021.