Towards a Natural Gas Compact for South Africa

Mail & Guardian

01-05-2025

Natural gas plays a vital role in South Africa's industrial base, powering sectors such as petrochemicals, steel, glass, ceramics, automotive, food processing, and pulp and paper. It is a strategic feedstock and enabler of industrial activity and jobs.
At present, South Africa relies almost entirely on a single source of natural gas: the Pande–Temane fields in Mozambique, delivered via the Rompco pipeline. However, these reserves are in decline and are expected to be depleted within the next few years — a looming supply gap that has serious implications for energy security and industrial continuity.
South Africa, hence, faces a looming 'gas cliff' — a sudden drop-off in supply as existing natural gas reserves run dry, with no replacement supply in place. If not urgently addressed, this gap could have wide-ranging economic consequences. The Industrial Gas Users Association – Southern Africa (IGUA-SA) warns that over 50,000 jobs across the gas value chain are at risk.
Beyond its economic relevance, natural gas is often positioned as a transition fuel for countries to have a viable low-cost energy source to realise their net-zero commitments towards decarbonising their economies by 2050. The net-zero imperative is in line with the objectives of the Paris Climate Agreement which seeks to keep the rise in global temperatures well below 2 degrees Celsius (2°C) as compared to pre-industrial levels.
Natural gas burns cleaner than coal and oil-derived products, emitting roughly half as much carbon dioxide (CO
2
) per unit of electricity generated — making it a lower-carbon option for delivering the same energy output. This has made natural gas an attractive solution for countries seeking to decarbonise and clean up without compromising industrial stability. It is why many countries see it as a necessary part of the energy mix, at least in the interim. This is especially true for hard-to-electrify sectors – such as steel, cement, petrochemicals, and heavy-duty transport – which require high-temperature heat and carbon-based feedstocks.
However, the 'transition fuel' framing has its critics. It is argued in some quarters that the continuous use of natural gas risks locking in fossil fuel infrastructure and delaying the shift to renewables. For South Africa, and indeed other countries in the Global South, the focus should not be on the choice between gas and renewables, but on securing affordable, reliable energy that supports industrial development and climate goals in parallel. In this context, natural gas could play a time-bound and significant role — if managed within clear net-zero pathways and backed by firm emissions controls.
Natural gas also plays a critical role in electricity generation, particularly as a flexible, fast-ramping fuel that complements intermittent renewable resources like wind and solar. In this way, it serves as a stabilising force in power systems undergoing transition. On the African continent — where over six hundred (600) million people still lack access to electricity — leveraging natural gas alongside renewables could unlock major gains in energy access, security, and system reliability. As Demba Diallo of the Africa50 Infrastructure Investment Platform notes, Africa's abundant gas reserves position it well to use gas as a 'right tool' for the just energy transition. A recent report by BCG and the National Business Initiative (
The Role of Gas in South Africa's Path to Net Zero
) emphasises that natural gas must be used responsibly and with awareness of time limitations, integrated with an aggressive expansion of renewable energy and grid upgrades. The report again underscores that without decisive action, South Africa may regress to more carbon-intensive fuels, compromising both its energy security and its net-zero pathway. It supports the responsible use of natural gas as a transition fuel — not in isolation, but alongside accelerated investment in renewables and clean technologies as innovations like carbon capture, usage and storage (CCUS) mature, they could help reduce emissions from gas-dependent sectors.
WBS Academics Marista Fey
The implications of a gas cliff go beyond energy security. Failure to act to secure and use natural gas in the interim could be a major setback for economic development and climate policy alike.
Navigating the trade-offs around natural gas demands more than theoretical debate — it requires pragmatic, fact-based engagement. The upcoming symposium on the state of South Africa's natural gas supply, hosted by Wits Business School's African Energy Leadership Centre (AELC) on 7 May 2025, is both timely and necessary. It offers a critical opportunity to move from abstract discussions to tangible strategies for securing South Africa's future energy mix.
Discussions will address key barriers: policy uncertainty, infrastructure financing, and regulatory bottlenecks. A particular focus will be placed on the urgent need to develop gas infrastructure, especially the systems required for liquified natural gas (LNG) importation — including terminals, regasification facilities, storage capacity, and integration with existing pipelines and industrial networks. These are large, capital-intensive projects with long lead times. Without immediate action and clear investment commitments, South Africa may miss the narrow window to have infrastructure operational before current supplies run out.
Organisations such as Transnet Pipelines, Vopak, and Egoli Gas will share insights into the current state of South Africa's gas infrastructure and the gaps that need urgent attention. Their contributions will help shape a realistic action plan aligned with both economic resilience and climate ambition.
The envisaged outcome is the development of a new compact for a resilient and well-functioning South African gas sector — one that safeguards industrial competitiveness, job creation, drives inclusive socio-economic development, and ensures that the use of natural gas meaningfully supports, rather than hinders, South Africa's transition to a net-zero economy by 2050.