TotalEnergies says will quit South African offshore gas block

TotalEnergies (TTEF.PA), a major French oil company, announced on Monday its decision to exit an offshore natural gas block located off the southern coast of South Africa due to the challenges of commercial development.

Earlier this month, TotalEnergies indicated its plans to withdraw from Block 11B/12B, which poses a setback to South Africa’s ambitions for energy independence through the development of its largest offshore gas discoveries to date.

TotalEnergies became involved in Block 11B/12B in 2013 and discovered two gas deposits, Brulpadda and Luiperd. However, the company indicated that these finds could not be developed commercially due to the economic difficulties associated with monetizing these gas resources for the South African market. The statement did not elaborate on the specific challenges encountered. Oil companies have encountered numerous legal obstacles from environmentalists and bureaucratic hurdles that have reduced investor interest in South Africa’s offshore region, where challenging sea conditions and strong currents further hinder exploration activities.

TotalEnergies’ exit follows an earlier decision by its Canadian partner CNRI to withdraw from Block 11B/12B, which South Africa’s government hoped could supply gas to an idle gas-to-liquid plant at Mossel Bay operated by national oil and gas company PetroSA. TotalEnergies, which held a 45% stake in the block, also decided to exit offshore exploration on the west coast in Block 5/6/7, where it held a 40% interest.

However, the company held onto a stake in Block 3B/4B, which lies on South Africa’s side of the Orange Basin, just south of big discoveries by Galp (GALP.LS), opens new tab, Shell (SHEL.L), opens new tab and TotalEnergies’ own Venus discovery in neighbouring Namibia.The post TotalEnergies says will quit South African offshore gas block appeared first on Radarr Africa.