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Petroleum Resources Development Bill Under Construction

July 15, 2019

Department of Energy

15 July 2019

The Draft Petroleum Resources Development Bill is being drafted.

The mineral resources and energy minister, Gwede Mantashe, confirmed this during the energy department’s 2019 Budget Vote Speech in parliament.

According to the minister, the proposed legislation will ensure that government provides “policy certainty for the upstream petroleum sector that is a relatively new sector in our economy, yet with great potential to grow GDP, contribute to the fiscus and create much needed Jobs”.

Mention was also made of the Draft Gas Amendment Bill designed to leverage available gas resources such as those in the Karoo and the recent discoveries in the Brulpadda field.

The minister also announced that the National Energy Regulator Amendment Bill will be finalised.

“The structure of National Energy Regulator of South Africa (NERSA) will be revised into 2 tiers with the introduction of a Review Board to deal with appeals. These changes are aimed at promoting efficient regulation of the energy sector.”

The minister also declared that a proposal for cabinet will be developed this year outlining how the electricity sector should be restructured.

“The proposals will seek to address challenges experienced by municipalities, Eskom and other key stakeholders within the sector.”

Once cabinet approval is obtained, the Electricity Regulations Act will be amended.

The minister confirmed that discussion in Nedlac on the Draft Integrated Resource Plan (IRP) was being wrapped up.

The Draft IRP will be tabled in cabinet for approval in September 2019.

In particular, it will outline the technologies that will replace the decommissioned coal plants, the majority of which will reach end of life between 2030 and 2040.

As regards nuclear power, the minister declared that planning for new nuclear power stations should start immediately to ensure energy security for South Africa.

“It is crucial for South Africa to plan for additional nuclear capacity beyond 2045 as we transition to a diversified cleaner energy future, in line with Chapter 5 of the National Development Plan (NDP). As we have stated on numerous occasions, the country would acquire nuclear at a price, pace and scale it can afford.”

The department was also looking into making greater use of natural gas.

“We, therefore, need to explore more economical options to bring natural gas into the South African market, including accelerating our own natural gas exploration activities such as the Karoo Shale Gas and the deep-sea discoveries.”

Work on the review of the Basic Fuel Price structures of petrol, diesel and illuminating paraffin, published in November 2018 for comment, was continuing.

One-on-one consultations with stakeholders have been concluded and provincial workshops will be held once the report is approved.