CAPE TOWN, July 29 (Reuters) - French oil major
TotalEnergies said on Monday it would withdraw from an
offshore natural gas block off South Africa's southern coast
because developing the finds commercially would be too
difficult.
Earlier this month, TotalEnergies had signalled its
intention to withdraw from Block 11B/12B, dealing a blow to
South Africa's efforts to become energy independent by
developing its largest offshore gas discoveries ever.
"TotalEnergies entered into Block 11B/12B in 2013 and made
two gas discoveries, Brulpadda and Luiperd, which could however
not be turned into a commercial development as it appeared to be
too challenging to economically develop and monetize these gas
discoveries for the South African market," the company said in a
statement, without giving further details about the challenges.
Oil companies have faced a series of court challenges by
environmentalists and bureaucratic delays that have dampened
investor appetite in South Africa's offshore zone, where rough
seas and strong currents also complicate exploration efforts.
TotalEnergies' exit follows an earlier decision by its
Canadian partners CNRI to withdraw from Block 11B/12B, which
South Africa's government hoped could supply gas to an idle
gas-to-liquid plant at Mossel Bay operated by national oil and
gas company PetroSA.
TotalEnergies, which held a 45% stake in the block, also
decided to exit offshore exploration on the west coast in Block
5/6/7, where it held a 40% interest.
However, the company held onto a stake in Block 3B/4B, which
lies on South Africa's side of the Orange Basin, just south of
big discoveries by Galp, Shell and
TotalEnergies' own Venus discovery in neighbouring Namibia.