Deal boosts pipeline project

South Africa's oil company, Sasol moved a step further last week toward developing a natural gas grid for southern Africa as the governments of South Africa and Mozambique approved the agreements necessary for a proposed gas pipeline between the two countries, 'Oil Daily' reported.

The pipeline is expected to deliver an initial volume of about 40 million cubic feet of natural gas per day, starting in the second quarter of 2004. Sasol, reports said, will convert its Sasolburg plants from coal to natural gas. The project also will deliver gas to local distributors.

The project has a high priority as South Africa works to expand its own industrial base and contribute to developments in surrounding countries. Still to be approved, however is the legislation that will establish the regulatory framework for the gas transmission industry in South Africa. That will be presented to the nation's parliament during the current session.

"The decision by the Sasol board to give the go-ahead for the Mozambique-to-South Africa Natural Gas Project demonstrates our commitment to southern Africa as a base for Sasol's international growth," said Patrick Davies, Sasol executive director.
"This is an exciting cross-border project, and I trust that it will serve as a model for other public-private partnership ventures so necessary for the South African economy," he said.