Total Steps up South African E&P Activity
South Africa's Tosaco Energy, which is affililated to France's Total, has been awarded three onshore technical co-operation permits (TCP) covering a total 2,900 km² by the country's upstream regulator, Petroleum Agency of South Africa (Pasa). Total meanwhile is to step up drilling offshore the country.
The three new onshore licences are all in the Mpumalanga province, near gas pipelines and power stations, said Tosaco on July 6.
The geological model proposes that the gas has been adsorbed from the interbedded coal beds and migrated into the adjacent sandstones, which then became conventional gas reservoirs, similar to those producing from offshore South Africa. Those do not need hydraulic fracturing to produce gas. Initial estimates show there are trillions of cubic feet of resources in the new licences.
Tosaco Energy is a majority black-owned South African exploration and production company focused on developing onshore natural gas resources and related infrastructure. Tosaco Energy is a sister company of Tosaco Holding, which owns a 25% interest in Total South Africa.
Tosaco's licence area
(Credit: Tosaco)
South Africa aims to produce more gas and burn less coal in its power sector: coal accounted for 70% and 68% of the country's primary energy in 2014 and 2015 respectively.
Tosaco CEO Bradley Cerff said the award of the 3 TCPs is an important milestone in the company's short history: "The award sets the stage for Tosaco Energy to become a fully integrated energy company building on existing investments. Local gas resources have the potential to reduce South Africa's dependence on coal. From a global perspective, there has been a conscious decision by a number of countries to reduce coal consumption and its use in electricity generation. Gas is a more environmentally friendly option for electricity generation with far less harmful atmospheric pollutants than coal."
Despite limited data available across the permits, the company is positive that it will be in a position to test the gas resource by early 2019, it said.
Total to drill offshore SA in 2018-19
Norwegian drillrig owner Odfjell Drilling meanwhile said July 4 that it had been awarded a contract by Total E&P South Africa to drill one well, plus one optional well, both offshore South Africa. Work will be fulfilled by its 6th generation semi-submersible drillrig, Deepsea Stavanger, offshore South Africa.
Despite ExxonMobil saying last year it might drill offshore South Africa, there's been little activity offshore in the past year and none yet by Exxon.
Odfjell said its contract will begin between June 2018 and April 2019 and shall be back to back with Odfjell's ongoing contractual work for German producer Wintershall, which is drilling wells on the Maria oilfield offshore Norway, or any subsequent contract. Odfjell said the up-to-$55mn value of its contract from Total E&P SA includes compensation for the mobilisation/demobilisation period. The firm well is expected to take 60-80 days to drill, said Odfjell.
Total declined to comment on its offshore plans to NGW. It is believed to be among several international companies eyeing an ongoing government tendering process to build LNG import facilities and power plants, as part of the country's planned transition away from coal to cleaner fuels.
William Powell