At a Glance
- Exxon Mobil eyes LNG growth as South Africa shifts from coal reliance.
- South Africa seeks LNG imports to stabilize the grid and expand renewable energy mix.
- Royal Vopak, Exxon plan Richards Bay terminal as potential LNG trade hub.
Exxon Mobil, a multinational oil and gas company, is betting on South Africa’s growing liquefied natural gas (LNG) market, positioning itself to capture demand in Africa’s most industrialized economy as the country seeks to cut coal dependence and stabilize its fragile power grid.
The U.S. oil major’s entry highlights rising investor interest in South Africa’s energy transition, with LNG seen as a bridge fuel to support renewables while reducing carbon emissions.
Industry analysts say the shift could transform South Africa’s power sector over the next decade, creating new trade flows for global gas exporters.
Exxon Mobil sees LNG opportunity in South Africa
Speaking at an African energy conference in Cape Town, Exxon Mobil’s vice president for LNG market development, Shahrukh Mirza, said the company views South Africa as a priority market.
“We’ve identified South Africa as one of the top priority markets to seed long-term LNG sales,” Mirza said. “That requires importing infrastructure and strong partnerships, which we’re actively pursuing.”
The U.S., already the world’s largest natural gas producer and leading LNG exporter, is expanding its global reach with new export projects set to boost supply this decade.
While analysts warn of a potential global gas glut by 2030, South Africa sees LNG as a timely solution to diversify energy sources as domestic reserves decline.
South Africa Shifts From Coal to Gas
South Africa currently sources most of its gas through pipelines from Mozambique, but those flows are projected to shrink. The government has opened talks with Qatar and the U.S. on LNG deals, signaling interest in multi-billion-dollar supply contracts over the next decade.
Exxon Mobil’s market studies suggest South Africa will require 6–7 gigawatts of new gas-fired capacity to complement solar and wind power projects.
For policymakers, gas is viewed as critical to bridging the transition away from coal while reducing the rolling blackouts that have weighed on the economy.
Exxon moves to anchor LNG trade
To strengthen its foothold, Exxon Mobil has signed a memorandum of understanding with Royal Vopak to explore an LNG regasification terminal in South Africa.
Vopak, in partnership with Transnet Pipelines, has already secured a 25-year concession to develop and operate an LNG import terminal at the Port of Richards Bay.
If completed, the facility could become the hub for LNG imports into South Africa, anchoring the country’s energy diversification plans and solidifying Exxon Mobil’s role in one of Africa’s most promising LNG markets.
