French energy giant TotalEnergies announced on Monday that it is withdrawing from two offshore gas fields in South Africa due to their lack of economic viability.
A subsidiary of TotalEnergies holds a 45 percent stake in a block off the country’s southern coast, where the Brulpadda and Luiperd fields were discovered.
TotalEnergies said they could “not be turned into a commercial development as it appeared to be too challenging to economically develop and monetise these gas discoveries for the South African market.”
The block, covering 19,000 square kilometers (7,335 square miles), is situated 175 kilometers (109 miles) off the southern coast of South Africa.
Qatar Petroleum, which has a 25 percent interest in the block, also revealed its plans to exit the project, according to Africa Energy Corp, a Canadian oil and gas exploration firm with a 10 percent stake through a subsidiary.
Earlier in July, another partner, CNR International, which owns 20 percent of the block, had already announced its departure.
Africa Energy Corp stated it plans to remain involved in the project and highlighted that under the joint agreement, companies exiting the block would forfeit their stakes to those who continue.
The company emphasized that the gas fields are “the largest discoveries of natural gas resources in South Africa.”
It added, “If developed, it could supply a significant portion of the country’s energy needs as it seeks to transition away from coal-fired power plants.”
Environmental groups have opposed the project, cautioning that drilling in the deep waters could jeopardize the region’s biodiversity and impact local fishermen.
