Natural gas is the joker in the hand of cards that South Africa’s policymakers hold in the hope of seeing the country’s energy security through to 2030.
According to the draft Integrated Resource Plan (IRP2010), natural gas could contribute 9% of our total electricity capacity by 2030, whereas now it contributes next to nothing.
The catch is that South Africa does not yet have any accessible natural gas reserves of its own and not much processing and pipeline infrastructure. But the vast arid scrublands of the Karoo Basin could hold untold reserves of natural gas trapped in porous shale rock more than 2km underground.
“The Karoo has the potential — if sufficient commercially viable quantities of natural gas are found — to change the face of South Africa’s energy future,” says Phaldie Kalam, Shell vice-president for communications within Africa.
Shell is one of a handful of companies (others include Bundu, Falcon, Anglo American and a Sasol-Statoil-Chesapeake consortium) that have been granted technical cooperation permits by the sector regulator, the Petroleum Agency of South Africa, to study the available geological data of the Karoo Basin.
The process, known as “desktop prospecting” includes an option to apply for an exploration permit if the company believes there are commercially viable reserves of natural gas in the area.
During the Sixties and Seventies prospectors discovered some natural gas reserves in the Karoo, but it was never seriously pursued as an energy option because of the country’s vast coal reserves. But with South Africa under pressure to reduce its carbon emissions in line with globally agreed targets, natural gas is now a more desirable option than it was several decades ago.
As Anton van Wyk, a director of hydrocarbon exploration company Advasol, says: “South Africa is the eighth-worst converter of CO2 into products and services in the world. This means that we are really badly placed in a world of low-carbon economies.
“Using natural gas, which emits a third of the CO2 of coal, for power generation would improve our standing to 13th-worst out of 30, putting us closer to the middle of the bunch.”
Although reducing carbon emissions is important in the long term, a more pressing need is to address the widening gap between South Africa’s energy demand and its supply.
The most celebrated example of how shale gas formations changed a country’s energy security for the better is the United States, which has reversed its reliance on imported gas to become a gas exporter in the past decade.
According to a report in the Asia Times last year, the Marcellus shale formation alone, which stretches from New York to West Virginia, could be worth $2-trillion and create 180 000 jobs.
But Kalam is keen to dampen expectations about the Karoo shale gas: “If we find sufficient quantities of natural gas, then we could begin full production in 2014. But in these early stages technology and infrastructure is likely to be imported and the required expertise will be highly specialised. So this is an expensive venture and we would see large-scale job creation happen only later in the process.”
But even in the early stages of preproduction, the gas could be used in generators to provide electricity in and around the remote and underdeveloped Karoo sites where extraction would take place, Kalam says.
Kalam emphasises the need for government to set up a conducive regulatory environment that would attract private investors, encourage private-public partnerships and allow for untried exploration and extraction techniques.
“This is pioneering stuff we are trying here, because we would be establishing an entire industry from scratch,” he says.
Indeed, one of South Africa’s few gas installations is Sasol’s 865km pipeline that brings natural gas from the Pande and Tamane gas fields in Mozambique to its conversion plant in Secunda, Mpumulanga.
The pipeline was completed six years ago and, according to a statement released by Sasol at the time, the venture cost $1.2-billion.
Were natural gas to be discovered in sufficient quantities in the Karoo, a pipeline to the country’s economic hub, Gauteng, would need to be even longer than Sasol’s and doubtless more expensive.
Shale gas is also more difficult to extract than so-called “conventiona” hydrocarbon deposits because the gas is trapped within the rock itself and not in isolated structural traps that can be accessed directly.
As a result, a controversial extraction process called hydraulic fracturing, or “fracking”, requires water to be pumped at high pressure into the shale rock to open up fissures, from which the gas can be extracted.
The potential discovery of shale gas in the Karoo has created concern among environmentalists, who point out that the region is among the most water-starved in the country. There are also fears that fracking could contaminate aquifers and ground-water with chemicals and petroleum compounds.
The documentary Gasland, released in the US earlier this year but yet to reach local cinemas, explores the impact of shale gas extraction on people living in parts of the US Midwest.
In one scene from the documentary a homeowner demonstrates how he can set his tap water alight because of its high petroleum content. Cue cynical jokes about the major energy companies lining up to “frack” up the Karoo.
But Kalam says that South Africa has the advantage of starting shale gas exploration and extraction after the US and can learn from its mistakes.
“I can categorically state that Shell won’t use potable water for fracking in the Karoo,” says Kalam. “We will use the brackish water found in the lower aquifers.”
“And so as not to contaminate the potable aquifiers, we would bypass them by drilling a pipe sealed in concrete down to the shale rock below,” he says, explaining that potable aquifers
are found 150m below the surface, but shale gas is found in rocks up to 4km deeper.
Apart from the Karoo, Shell has also applied for an exploration permit for a deep-water area 180km off the West Coast, where it hopes to find conventional deposits of natural gas.
Meanwhile, Advasol has also applied for licences to explore for natural gas at nine sites off the southern Cape coast.
The Kudu gas field off the southwest coast of Namibia is believed to hold gas reserves of similar size to Mozambique’s onshore fields, and will begin production in 2013, but it is uncertain how South Africa would benefit from Namibia’s gas.
“Some of the gas could be imported by pipeline to the Cape Town power stations, or the electricity could be generated in Namibia and fed down through the grid. There’s been a lot of on-off discussions of both options,” says Professor Kevin Bennett, the director of the Energy Research Centre at the University of Cape Town.
In the case of Mozambique and Namibia, however, experts warn about the risk to energy security of relying on foreign imports of natural gas.
“As we’ve seen with the way Russia uses natural gas as a political tool against Western Europe, our neighbours could just turn off a valve and say, ‘OK, let’s negotiate’,” Bennett says.
He argues that South Africa could save itself the expense of developing its own natural gas reserves if it focused on importing electricity generated elsewhere in Central and Southern Africa, such as a potential 40 000MW of hydroelectric electricity (“the whole of what Eskom currently generates in one go”) that could be generated at Inga on the Congo River.
Although acknowledging the similar risks to energy security of importing electricity as importing natural gas, Bennett says, “It’s quicker and cheaper to install a power line than to build a pipeline.”
And, as Van Wyk says: “We export coal-generated electricity to most neighbouring countries. The network is in place; the electricity might just come in the other direction in future.”
So the big “if” is whether we can find and tap our own reserves of natural gas, or develop the infrastructure to import natural gas over the coming decade, at which point the first 474MW unit of an eventual 7 646MW of gas-fired electricity is scheduled to come online.
Gas at a glance
What is natural gas? Natural gas is found as an “associated” hydrocarbon in oil fields, or as a “non-associated” hydrocarbon found isolated in gas fields. It can also be synthesised from coal.
Consisting primarily of methane, it is the cleanest source of fossil-fuel energy, but it is still a substantial contributor to global carbon emissions; something that will only increase as the global appetite for dirty coal and oil-fired electricity dwindles.
Natural gas is difficult to transport or store because of its low density, so in the case of longdistance piping, it requires a gas liquefaction and deliquefaction plant at each end of the pipeline to convert the gas into liquefied natural gas (LNG).
The need for conversion plants thus increases the associated costs of the resource. Over shorter distances, such as by road, natural gas can be transported as compressed natural gas (CNG).
Generating electricity
Natural gas is used as a fuel burned in open-cycle gas turbines (OCGTs) to produce electricity. The technology can be compared with that of a jet engine attached to a generator.
The simplicity of OCGTs allow them to be fired up at short notice to meet peaking capacity at times of the day when demand exceeds the reserve margins provided for by the base-load capacity from the multimegawatt power stations.
The efficiency of OCGTs can be increased by up to 50% with the addition of a second generation cycle to create a combined-cycle gas turbine, which uses the high pressure and temperature of the first cycle to generate more electricity.
Other uses
In addition to electricity generation, natural gas can be converted into synthetic liquid fuel through gas-to-liquid technology.
It is also used in specialised manufacturing that requires extremely high temperatures, such as glass, ceramics, bricks and the heavy-duty, durable plastic coating on household appliances such as your fridge.
In countries with a much more developed gas infrastructure than South Africa, liquefied gas is piped directly to people’s homes and is used for heating and cooking.