Scramble to replenish feedstock for Mossel Bay refinery

2nd December 2011 By: Joanne Taylor

South African national oil company PetroSA will look at importing feedstock from Mozambique to replenish its Mossel Bay gas-to-liquids (GTL) refinery if it is not granted exploration rights for potential gas pockets off the Cape coast.

The 80 000 km2 exploration area, from Cape Agulhas to Saldanha, north of Cape Town, runs from the West Coast to the South Coast.

The Mossel Bay refinery is responsible for 5% of the country’s fuel and will shut down in 2014 if feedstock is not secured.

Should the custodian of the national petroleum exploration database, Petroleum Agency South Africa, grant PetroSA exploration rights for the Cape coast, the corporation will start a multistage process that involves the acquisition, processing and interpretation of seismic data.

“The collection of seismic data will be carried out by specialised contractors, appointed through a tender process. Drilling can only start once a target has been defined by seismic testing,” says PetroSA communications manager Thabo Mabaso.

The cost of the seismic data acquisition is dependent on the size of the surveyed area, the weather conditions during acqui- sition and the availability of a seismic vessel.

The identification of drilling targets can take up to three years and is depend- ent on the processing and interpretation of the seismic data and the incorporation of the new data into the regional geological understanding of the West Coast, notes Mabaso.

He says there is a need for gas on the West Coast for power generation purposes and the West Coast projects would be well placed to meet the demands in the area.

“It is a project requirement to secure a sales guarantee to underpin the original investment decision and, given that there is no gas infrastructure in that region to bring the gas to market, an additional commercialisation requirement is the gas transportation infrastructure,” he says.

Once a project has been commercialised, the infrastructure may allow gas supply to other industrial and domestic markets in the Cape.

Mabaso says a number of companies already have oil and gas exploration projects off the Cape coast of South Africa.

The company has full exploration rights for Block 1, located off the coast of Alexander Bay, and is involved in a joint venture with exploration company Pioneer Natural Resources at Block 9, which is off the Mossel Bay coast.

“The value of all the gas exploration projects is of strategic, commercial and national importance as oil and gas dis- coveries in South Africa will have a huge impact on the energy sector and may provide local gas-generated electricity and indigenous oil.”

Meanwhile, PetroSA has embarked on Project Ikhwezi, which is expected to produce first gas off the F-O field in 2013 to help sustain the life of its 45 000 bl/d Mossel Bay GTL facility.

Project Ikhwezi is in the eastern part of Block 9 on the north-eastern flank of the Bredasdorp basin, which is a sub- basin of the Outeniqua basin on the south- ern continental shelf. This is 40 km south-east of the current F-A production platform, which supplies gas and condensate to the Mossel Bay refinery.

PetroSA acting president and CEO Yekani Tenza states that the project will serve as an enabler of further developments of gas prospects, which could provide an extra five-year supply for the GTL facility.

In addition, PetroSA is evaluating its asset portfolio for feedstock with a view to ensuring long-term sustainability of the refinery.