A South African ministerial panel has started reviewing a new law to regulate the energy industry with a view to ensuring it doesn’t discourage investment, Mineral Resources Minister Ngoako Ramatlhodi said.
Proposed changes to the 2002 Mineral and Petroleum Resources Development Act include giving the state the right to a free 20 percent stake in all new energy ventures and to change how projects are awarded. Exxon Mobil Corp., Anadarko Petroleum Corp. and Total SA are among those that have objected to the law on the grounds that it will undermine their businesses.
“Oil and gas are new in our country so we need to apply our minds that whatever regime we take in the legislation can be sustained in good times and in bad,” Ramatlhodi told members of Parliament’s mineral resources committee in Cape Town yesterday. “We want to unlock investment as quickly as possible. We can’t wait. The development of upstream oil and gas industry will be a focus during the next five years.” The Parliamentary Monitoring Group posted a recording of the meeting on its website today.
The amendments were passed by the National Assembly and National Council of Provinces earlier this year. Ramatlhodi asked President Jacob Zuma to hold off on signing them into law pending a review by a committee comprising himself and the ministers of finance, trade and industry, energy and economic development.
“We from government want to ensure that whatever arrangements are made, as we negotiate this aspect, the state is not denied the opportunity to take part directly in the oil and gas industry,” Ramatlhodi said. “We can collaborate with the private sector where they have got their own blocks and be able to get our own blocks.”