French oil giant TotalEnergies announced on Monday its withdrawal from two offshore gas fields in South Africa. The company cited “difficulties encountered in developing and monetizing” two gas discoveries made in the “South African market.”
Withdrawal from Block 11B/12B
“Following the decision of our partner CNRI to withdraw from block 11B/12B, TotalEnergies also announces its withdrawal from this block located off the southern coast of South Africa,” the company stated in a press release on Monday.
Block 11B/12B Details and Ownership
Block 11B/12B covers an area of 19,000 km2, with water depths ranging from 200 to 1,800 meters. TotalEnergies, through its subsidiary TotalEnergies EP South Africa, holds a 45% stake in the block, alongside Qatar Petroleum (25%), CNR International (20%), and the South African consortium Main Street 1549 (10%).
Significant Gas Discoveries and Commercial Challenges
Since entering the block in 2013, two significant gas discoveries have been made: one at Brulpadda and one at Luiperd, both located in the Outeniqua Basin, 175 kilometers off the South African coast.
However, these discoveries “could not be converted into commercial development due to the difficulties encountered in developing and monetizing these gas discoveries in the South African market,” TotalEnergies lamented.
Environmental Concerns and Partner Withdrawals
The project to exploit the Brulpadda gas field sparked outrage from environmental NGOs in October 2022. Bloom and the South African NGO The Green Connection denounced “deepwater drilling operations in South Africa” that could threaten “small-scale fishers and spectacular biodiversity.”
CNR International (20%) had already announced its withdrawal from block 11B/12B in early July. In addition to TotalEnergies, Qatar Petroleum (25%) also announced its withdrawal on Monday, according to a statement from Africa Energy Corp, a Canadian oil company holding a stake in Main Street 1549.
Transfer of Ownership and Africa Energy’s Position
Under the agreement binding the four partners, “the withdrawing parties transfer their interest free of charge to each of the non-withdrawing partners,” stated Africa Energy Corp, which “does not intend to withdraw” and should therefore eventually “hold a 100% interest in block 11B/12B.”
Furthermore, “TotalEnergies has also decided to withdraw from offshore exploration block 5/6/7, in which TotalEnergies EP South Africa currently holds a 40% interest,” the company added on Monday.
TotalEnergies’ Remaining Exploration Permits
In addition to these two blocks, TotalEnergies operates four other deepwater exploration permits in South Africa, including one recently acquired in block 3B/4B.