South Africa offers to buy US LNG in order to seek trade deals

According to a statement on the website of the South African government's news agency, South Africa offered to purchase liquefied gas from the United States for a period of 10 years as part proposals to secure a deal.

The document signed by Minister of the Presidency Khumbudzo Ntshavheni, and posted late Sunday night, stated that South Africa intends to import 75-100 petajoules (roughly 75 to 100 millions cubic metres) of LNG from the United States each year, which is the world's largest LNG exporter.

The Minister said this would "unlock about $900 million to $1 billion in trade annually and $9 billion to $12 billion over 10 years, based on the applicable price".

The South African trade package was presented by President Cyril Ramaphosa during his visit to the White House in May, when President Donald Trump confronted Ramaphosa over government policies such as land-reform and Black economic empowerment and falsely claimed that whites were being "genocided".

Ramaphosa hoped to use this meeting to reset the relationship between his country and the U.S. after Trump cancelled aid to South Africa that was much needed, granted refugee status to the white Afrikaner minority, expelled its ambassador, and criticised the genocide case brought against Israel by the court.

Ntshavheni was a senior government member and cabinet spokesperson who was part of Ramaphosa's delegation to Washington.

She said South Africa will work with the U.S. on exploring areas of technology cooperation, including fracking to unlock gas production in South Africa.

The package includes a duty free quota for South Africa of 40,000 cars per year and duty free access for automotive parts sourced in South Africa for production in the United States.

According to the document, a duty-free quota for steel of 385 millions kilograms per year and aluminium of 132 million kilograms per year was proposed.

Technical Issues

The website of the government news agency, where this article was first posted, was unavailable on Monday. The editor said that the document was seen by on Sunday, and that the website was down for technical reasons.

Ntshavheni posted a link on her X page on Sunday. Her spokesperson did NOT respond immediately to "questions" and it wasn't clear whether the document posted on Sunday was a final copy. The spokesperson for the presidency did not respond.

Ntshavheni stated that LNG imports will be supplemented by U.S. investments in gas infrastructure as Africa's advanced economy pivots away from coal-fired electricity stations and towards natural gas.

Trump has used energy as a bargaining chip after he unleashed global tensions in the trade wars last month by announcing tariffs against all his trading partners.

U.S. Liquefied Natural Gas (LNG) would be a good option for South Africa. It imports the majority of its gas through a pipeline that runs from Mozambique and may run out in a few short years due to its neighbour's decreasing supplies.

The Karoo region of South Africa is believed to contain significant quantities gas, but an environmental moratorium has slowed down exploration.

"South Africa and the U.S. (will) negotiate an agreement to facilitate LNG imports of the U.S., at the appropriate price." Ntshavheni stated that this will not replace the current gas suppliers but rather complement them. Reporting by Wendell Roelf, Editing by Olivia Kumwenda Mtambo and Barbara Lewis

(source: Reuters)