South Africa is confronting a critical natural gas supply shortfall that threatens to disrupt industrial operations across the country, according to statements from industry leaders and academic experts cited in reporting from MiningWeekly.com. Approximately 300 industrial gas buyers in the provinces of Gauteng and Mpumalanga face severe supply deficits as the nation approaches what the Industrial Gas Users Association-South Africa has described as a gas cliff. The supply crisis stems primarily from declining gas output from Mozambique's Pande and Temane fields later this decade, compounded by significant delays in developing alternative supply infrastructure.
Jaco Human, executive officer of the Industrial Gas Users Association-South Africa, attributed the situation to a combination of inaction, weak coordination, and limited engagement between government and the private sector. He emphasized that the problem requires direct attention across the entire value chain, from upstream production through midstream transportation to downstream distribution, rather than an indirect approach focused solely on electricity generation. According to Human, the South African chemical company Sasol will continue supplying methane-rich gas only until mid-2030, after which no further domestic gas will be available from that source.
Additionally, liquefied natural gas terminals planned for Inhassoro, Matola, and the ZET project appear unlikely to be operational by mid-June 2030, with Human describing the timeline as impractical from technical, financial, and construction perspectives. Despite acknowledging that certain policy moves are being implemented, industry now faces the question of how to navigate the impending shortage rather than whether it will occur. Natural gas plays a substantial role in South Africa's industrial base despite representing only approximately 3% of the country's primary energy mix.
Professor Maurice Radebe, head and director of Wits Business School, noted that the sector supports critical manufacturing industries including chemicals, glass, steel, automotive, and food processing, which collectively represent about 8% of national GDP. Sasol has warned that pipeline supplies to third-party industrial users will be phased out by 2028 as Mozambican field output declines, with remaining volumes reserved for its own Secunda operations. Radebe identified multiple structural challenges impeding sector development, including pipeline and distribution bottlenecks, pricing disparities, and legal and environmental regulatory hurdles.
He stressed that more than 300 industrial buyers in Gauteng and Mpumalanga cannot afford further delays in resolving the supply shortage. Some positive developments are emerging in the sector. Professor Logan Rangasamy, interim head and director of Wits Business School, highlighted signs of progress including a gas-to-power procurement programme that attracted four bids offering approximately 2,800 megawatts against a government target of 2,000 megawatts.
The sector is awaiting the announcement of preferred bidders, which would provide certainty for liquefied natural gas infrastructure development. Legislation to modernize South Africa's Gas Act is currently before Parliament, and discussions regarding liquefied natural gas import terminals and the repurposing of existing pipelines are advancing. Rangasamy cautioned that legislative reform alone cannot deliver infrastructure development, emphasizing that clear decision-making, coordination, and bankable financial frameworks are more critical than ever.
He noted that Mozambique could emerge as a significant regional gas supplier over the next decade following the restart of its liquefied natural gas project, with additional supply developments underway in Tanzania, Nigeria, Senegal, Angola, and Namibia. South Africa, with its industrial base, financial markets, pipeline networks, engineering expertise, and regulatory institutions, could play a leading role in directing supply to support regional growth and energy security. A key tension identified by Rangasamy involves balancing gas development against climate change commitments and affordability concerns.
Gas must complement, rather than compete with, the expanding renewable energy sector, and the benefits of development must extend beyond sector investors to ordinary South Africans and Africans. Oliver Naidu, president of Vopak South Africa, provided updates on the ZET project, a joint venture between Vopak Terminal Durban and Transnet Pipelines. The project is awaiting the announcement of a preferred bidder from the Independent Power Producer Office as its initial trigger.
A front-end engineering design decision is scheduled for November, followed by finalization of environmental impact assessments and engineering, procurement, and construction strategy. If timelines are met, a final investment decision could occur in early or mid-2028, with Phase 1requiring approximately two years and targeting commercial operation by 2030. Transnet Pipelines business development head Kresen Naicker described an opportunity to repurpose existing infrastructure from the Lilly pipeline, characterizing it and the ZET project as an integrated supply chain.
Transnet Pipelines aims to increase capacity from 23 petajoules to 60 petajoules, primarily through intake pressure from the ZET project, with additional capacity unlocked through subsequent upgrades. Capacity growth will depend on firm customer commitments to support reliable and affordable gas supply. Naicker stressed the importance of regional collaboration to exploit infrastructure synergies and highlighted the need for binding commitments and regulatory alignment to achieve commercial operation by mid-2030.
Source: indexbox.io