French oil major TotalEnergies has notified South Africa’s oil regulator of its intention to withdraw from its 11B/12B offshore gas field, but has not yet submitted a formal request to do so, a source at the Petroleum Agency SA said.
TotalEnergies discovered the first of two major gas discoveries mainly in Block 11B/12B off its southern coast in 2019, and the withdrawal is a setback for South Africa, which had been counting on the gas to supply a dormant national gas-to-liquids refinery in Mossel Bay.
Gas price talks have been stalled for years, while TotalEnergies has invested heavily in exploring nearby Namibia, a global exploration hotspot since TotalEnergies, Shell and Galp made new discoveries.
“The main reason (for the withdrawal) is the inability to secure a market for gas,” the source told Reuters on Tuesday.
“They have not withdrawn their request for production rights (to 11B/12B),” added the source, who was not authorized to speak to the media.
TotalEnergies did not immediately respond to a request for comment.
Bloomberg reported the news last Tuesday.
In March, TotalEnergies partnered with QatarEnergy to buy a stake in an oil and gas exploration license on the west coast of South Africa, as part of plans to develop the Orange Basin in Namibia.
The prolific Orange Basin, where most of Namibia’s oil discoveries have been made, extends south into South African waters.
