South Africa’s industrial economy is exposed
The shortage is not simply an energy-sector problem.
Natural gas is an important input for the production of chemicals, steel, glass, food and beverages, fertiliser and other industrial products. Sasol’s Secunda complex is particularly exposed because of its dependence on gas as a feedstock.
The implications extend beyond Sasol. Hundreds of industrial customers rely on the existing supply system, meaning disruptions could affect production, employment and the cost of doing business across several sectors.
The urgency was underscored by South Africa’s first Gas Independent Power Producer Procurement Programme bid window. Although government sought 2,000MW of gas-fired generation capacity, no preferred bidders were appointed because the companies could not provide sufficient assurances of gas supply.
In other words, South Africa is trying to procure new electricity generation without having secured the fuel infrastructure needed to support it.
That is a serious planning problem.
Government cannot credibly position gas as part of the country’s electricity strategy while leaving the supply question unresolved.
Regional cooperation is becoming an economic necessity
Mozambique’s proposal also demonstrates why energy cooperation should be central to Southern Africa’s economic integration agenda.
The region has resources, infrastructure and industrial demand, but these are not always connected in ways that allow countries to benefit from one another’s strengths.
South Africa has a large industrial market and established energy infrastructure. Mozambique has substantial natural gas reserves and an expanding LNG industry. Connecting these capabilities could create benefits beyond the immediate supply agreement.
It could strengthen cross-border investment, support industrial activity, create infrastructure-related employment and establish a more integrated regional energy market.
For Mozambique, supplying South Africa would also offer an opportunity to retain more economic value from its gas resources within the region instead of directing almost all new production towards overseas markets.
This matters for Africa more broadly. Energy resources should not only be measured by their export earnings. Their contribution to regional manufacturing, electricity access and industrial development should also count.
The proposal is promising, but timing remains the problem
There are reasons to be cautious.
ENH is targeting infrastructure readiness around 2030 or 2031. That is potentially too late to prevent the supply pressure expected from 2028. The project still needs investment commitments, commercial agreements and construction.
Sasol has said it would be premature to speculate on the nature or scale of any potential investment while it evaluates alternative gas supplies. The proposal therefore remains an option under consideration, not a confirmed supply solution.
There is also the question of price. Mozambique’s domestic allocation could offer a more competitive alternative to international spot-market LNG, but the final cost will depend on commercial arrangements, transport, infrastructure and the price at which the gas is made available.
South Africa must also avoid replacing one supply dependency with another without building greater flexibility into its energy system.
Southern Africa cannot afford another delayed energy response
Mozambique’s proposal deserves serious consideration, but it should not become an excuse for South Africa to postpone decisions on its wider gas infrastructure.
The country needs a coordinated plan that brings together regional pipeline supplies, LNG imports, domestic exploration and investment in alternative energy sources. It also needs clear regulatory rules and credible long-term purchasing commitments to make infrastructure projects financially viable.
For Mozambique and South Africa, this is an opportunity to demonstrate what practical regional integration can achieve.
South Africa’s gas shortage is no longer a distant warning. It is an approaching industrial risk. Mozambique may be able to help avert it, but regional energy cooperation will only matter if the infrastructure is delivered before businesses are forced to absorb the consequences of years of delayed planning.
Written by:
*Dr Iqbal Survé
Past chairman of the BRICS Business Council and co-chairman of the BRICS Media Forum and the BRNN
*Sesona Mdlokovana
Associate at BRICS+ Consulting Group
Africa Specialist
**The Views expressed do not necessarily reflect the views of Independent Media or IOL.
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