Minister of Mineral and Petroleum Resources Gwede Mantashe has published the draft Petroleum Products Bill 2024 for public comment.

The draft Bill focuses on regulating the downstream petroleum industry and introduces new licensing and regulatory requirements to bring transparency and fairness into the industry and promote transformation in favour of previousaly disadvantaged groups of people. It also aims to ensure environmental sustainability in response to global pressure to reduce the carbon footprint of energy production.

Speaking recently at Africa Oil Week 2024, Mantashe said the proposed new legislation includes provisions to protect the environment during petroleum exploration and distribution activities. The Bill proposes stricter regulations on environmental impact assessments and enhanced compliance requirements for oil and gas companies operating in South Africa. All new projects must adhere to internationally recognised standards of environmental protection to reduce the risk of oil spills and pollution during production and transportation.

“Our aim is responsible development that balances economic growth with environmental stewardship. Before any shale gas exploration or other major petroleum activities, we are insisting on robust guidelines that minimise the environmental impact,” Mantashe said.

Companies will have to submit comprehensive environmental management plans before any exploration or production activities start and these will be subject to approval by the Department of Mineral Resources and Energy and the Department of Forestry, Fisheries and the Environment to ensure a multi-layered approach to environmental oversight.

The Bill is also expected to open up the local gas market to improve energy security. It includes regulatory frameworks for gas exploration, production and distribution, addressing issues that have hampered investment in the sector.

Mantashe said gas is an important fuel in the country’s energy mix.

“We are targeting between 5% and 8% potential gross domestic product growth from oil and gas based on the models we've seen in neighbouring countries like Namibia.”

In addition, the Bill provides for the establishment of a state oil company, which will be a consolidation of entities including PetroSA, the Strategic Fuel Fund and iGas, to manage the country’s petroleum resources.