Regional technical studies of South Africa recently completed by Bastion’s geologist leave no doubt that the immediate solution to South Africa’s energy crisis is onshore gas. Gas has been under South Africa’s feet having its origin in the abundance of coal seams trapped by a unique sequence of geology. These technical studies, together with the onshore drilling success by Australian listed company Kinetiko Energy Limited’s subsidiary Afro Energy (Pty) Ltd, supports this premise.
Kinetiko’s more recent drilling successes are detailed in their April 2023 quarterly report (https://www.investi.com.au/api/announcements/kko/770aebdd-2a5.pdf). Unknown to most, particularly those making decisions regarding South Africa’s future energy requirements and the sources thereof, is that Kinetiko has for the past 13 years been investing in South Africa and steadily conducting operations proving up the abundance of onshore gas. A recent research report published on 1 May 2023 by MST Access (https://www.kinetiko.com.au/wp-content/uploads/2023/05/MST-Access-KKO-Update-1May23.pdf), states that Kinetiko has 4.9 TCF (trillion cubic feet) 2C contingent gas resources within its licensed areas of approximately 7000km2 in the Mpumalanga region. Contingent resources are those quantities of discovered gas resources estimated, as of a given date, to be potentially recoverable from known accumulations or deposits using established technology.
In September 2022, Renergen, listed on the South African and Australian Stock Exchange and the first holder of an onshore gas production right, became the first commercial producer of onshore gas converted to liquified natural gas (Virginia Gas Project, a game-changer for the South African economy).
The Elandsfontein power project successfully completed in 2022 with gas supplied by Sasol from its gas production operations in Mozambique, originally utilized coal. It was converted to four 500KW gas engines now putting power in the municipal grid. (Energas successfully completes turnkey gas power plant project).
With the increase in geological understanding of RSA onshore gas, exploration has now been significantly de-risked creating a new investment pathway in gas resources without the high risk usually equated to expensive offshore oil and gas exploration. More importantly, onshore gas production projects are less capital intensive with shorter project completion time frames. The market for gas in South Africa continues to grow and demand is expected to increase over the foreseeable future. In an article published by “the African Report” in January 2023 Sasol, ambitious to reduce their greenhouse gas emissions, sees gas as a transition feedstock (South Africa: Sasol pins future on gas as a transition feedstock).
Bastion’s previous newsflash (RSA Onshore Gas: Keep the reasons for Onshore Gas Exploration simple (Part 2)) estimates that 1.2 TCF of proven gas reserves can power a 1000MW power station or ten 100MW power stations for 20 years. As Kinetiko, Renergen, Bastion, Bulwark Oil and Gas SA (Pty) Ltd and other onshore exploration companies continue their technical studies, operations and exploration drilling, South Africa’s proven gas resource numbers will increase as the coal geology in South Africa consistently bears testimony. It is common cause that solar together with gas is the perfect dispatchable power solution for South Africa’s electricity crisis and that gas is the clean energy resource necessary for industrial growth. Gas in developing economies creates sustained growth opportunities, raises income levels and leads to poverty and unemployment reduction.
Bastion and Bulwark have in the last six months been in serious discussions and negotiations with a variety of potential investors and recently completed their internal prospective recoverable gas resources report which will be shared with shareholders and investors. As Bastion continues to de-risk its onshore gas opportunities through intelligent exploration, we look forward to partnering with like-minded companies, development finance institutions and industry as joint venture partners, financiers, contractors and gas off-takers who like us consider this a worthwhile endeavour.
For more information please contact the undersigned at barrisford@bastionoil.com or info@bulwarkoil.co.za
Barrisford Petersen
Founder and Managing Director
Bastion Oil and Gas South Africa (Pty) Ltd
Bulwark Oil And Gas Sa (Pty) Ltd
Rockit Energy (Pty) Ltd
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