South Africa Reconsiders Oil Law

July 17, 2014

The government of South Africa is reconsidering its new oil and gas laws. The laws have caused some consternation with investors who were afraid they would not be able to make a profit on their assets under the new regime. Parliament passed the law in March, giving the state a 20% free stake in new gas and oil exploration and production ventures.

“Having spent time listening to stakeholders … I am ready for any eventuality,” Mineral Resources Minister Ngoako Ramatlhodi told parliament. “In the event the current bill is assented to in its form, I commit to rigorous and transparent engagement with stakeholders on draft regulations.”

Currently the new law is before President Jacob Zuma who must give it his assent before it becomes law. Ramatlhodi told reporters there was broad agreement on the 20% free-carry for the state and 10%for ‘black empowerment’, but the sticking point was on where to cap these.

Copyright, Petroleum Africa, 2014.