South African upstream oil and gas company PetroSA is investigating the possibility of restarting operations at a Mossel Bay gas-to-liquid fuel plant.

A spokesperson for PetroSA, Nonny Mashika Dennison, said the company was undertaking a comprehensive assessment of all factors affecting the viability of the plant. The gas-to-liquid fuel facility ceased production in 2020 due to depleted offshore gas reserves.

Despite a lack of domestic gas reserves, PetroSA is experiencing a bottleneck crisis in refinery capacity due to a large volume of gas imports, according to the acting CEO of PetroSA, Sandiswe Ncemane. PetroSA said it was eager to revive the facility after the closure of South Africa’s two largest refineries, Sapref and Enref.

The Mossel Bay plant was capable of processing up to 45 000 barrels a day before its closure. The company selected Gazprombank Africa, Russia’s third-largest bank as its investment partner. Due to the Russia-Ukraine war, Russia is under sanctions. Experts expressed concern that South Africa would be affected by secondary sanctions as well, reports The Citizen.

PetroSA, in response, said it has obtained legal advice to minimise the risk of secondary sanctions. The project is set to cost about US$200 million (R3 billion).