South Africa’s Central Energy Fund (CEF) aims to increase capacity at the SAPREF refinery following its acquisition of the facility in 2024. The refinery produced 180,000 barrels per day (bpd) before closure in 2022 due to floods, but the CEF aims to increase capacity to between 400,000 and 600,000 bpd.
Speaking at the Southern Africa Oil & Gas Conference (SAOGC) in Cape Town – whereby the African Energy Chamber serves as a Strategic Partner – Dr. Tshepo Mokoka, Acting Group CEO of CEF, announced that the aim is to increase capacity to meet the country’s rising demand for fuel. He explained that “we want to address demand by processing the hydrocarbons that we have [on- and offshore] South Africa as well as those in neighboring countries.”
The refinery aligns with a broader strategy by the government and its state-owned energy companies to implement a just energy transition in South Africa. This approach would see accelerated investments in oil and gas exploration and production, in tandem with aggressive renewable energy advancements. Dr. Mokoka added that the CEF is striking a balance between renewable energy and hydrocarbons. They are developing several solar facilities while targeting gas-to-power deployment.
“We are heavily invested in gas-to-power projects and FID studies to ensure that around 4 GW are generated across the country. This is the balance we are striking but it is important for us to lean on hydrocarbons to get to a point where we can ensure security of supply,” he said.
Nazeem Braaf, Project Management Office at the country’s newly-established national oil company – the South African National Petroleum Company – believes that South Africa has a tremendous opportunity to become both a hub for petroleum as well as critical player in the energy transition.
“In Africa, we see developing economies continue to grow at a rapid pace. Reserve replacements are a significant challenge, and so, it is clear that we will have a delayed transition. South Africa is one of the giants in Africa from a consumption perspective and development perspective. The transition period is a critical period and should be done in an orderly manner,” he said.
While the global north is looking at eliminating fossil fuel utilization in favor of renewable energy, countries such as South Africa continue to prioritize oil and gas investment, targeting enhanced energy security. Helen Robinson, Global R&D Manager at the International Geothermal Association, believes that geothermal has a key role to play in South Africa’s just energy transition. Geothermal not only offers a low-carbon energy source but can effectively extend the lifecycle of oil and gas projects, ensuring monetization beyond commercial timelines.
She explained that for geothermal, “we don’t need volcanic systems and this is because our technology has advanced so much that we can use low temperatures to generate electricity. Instead of turning off hydrocarbons and turning on renewables – which is completely unrealistic – we can explore what can be done for oil and gas [previously] abandoned on the continent. Those resources can be used for geothermal energy. We can look at extending the life of an oil and gas well, delaying closure and mitigating the risk of methane risk by these wells.”
As such, the opportunities for South Africa’s energy transition are endless. While the country advances exploration and field development in the offshore Orange and Outeniqua Basins, the country also seeks to monetize onshore shale resources. An ambitious renewable energy agenda targets GW-scale renewable capacity while infrastructure projects aim to position the country as a regional hub for energy. This approach positions South Africa as a blueprint for other African countries seeking to balance hydrocarbon and renewable energy development.
