• Sasol to use methane as bridge fuel until LNG imports start around 2030.
• South Africa faces gas supply gap as Mozambican reserves decline.
• Industry warns LNG tax clarity, guarantees needed in 2025 to stay competitive.

Sasol Ltd. plans to use methane-rich gas as a stopgap supply between 2028 and 2030, ahead of South Africa’s first liquefied natural gas (LNG) terminals coming online, the company said.

The petrochemicals group will maintain current gas production until fiscal 2028, before shifting to methane from its Secunda operations to cover demand until LNG infrastructure at Richards Bay and Ngqura (Coega) is operational around 2030, according to local media reports.

Sasol signed a memorandum of understanding with Eskom in September 2024 to explore LNG use and support the creation of a domestic gas market as the country faces tightening energy supply.

The Industrial Gas Users Association of Southern Africa (IGUA-SA) has warned that industries such as chemicals, metallurgy and power generation depend heavily on reliable gas supply. For two decades, South Africa has relied on Mozambican reserves, which are expected to decline by the end of this decade.

The interim methane solution gives Eskom and regulators time to structure demand, build import terminals, and finalize a regulatory framework. The National Energy Regulator of South Africa (NERSA) will need to issue licenses and set tariffs to integrate LNG supply into the market.

The plan, however, complicates Sasol’s climate strategy. The company is targeting a 30% reduction in greenhouse gas emissions by 2030, while methane-based fuels are more carbon intensive.

In January, IGUA-SA cautioned that the local industry—worth nearly 700 billion rand ($37.8 billion) annually—needs tax clarity and investment guarantees by 2025 to secure LNG projects and protect competitiveness.

This article was initially published in French by Abdel-Latif Boureima

Adapted in English by Ange Jason Quenum