South Africa’s Gas Cliff: LNG Companies and 2030 Risk

The short answer

South Africa’s “gas cliff” is the expected decline in pipeline gas from Mozambique before replacement supply and infrastructure are fully available. It is a forecast supply transition, not evidence by itself that South Africa is already experiencing a single nationwide physical gas shortage. Parliament has described the risk as a gas cliff, while industrial gas users warn that the supply crisis could be triggered before 2030. ^[1][2]

The central proposed import route is liquefied natural gas (LNG) through a new terminal at the Port of Richards Bay, developed by Zululand Energy Terminal (ZET). Sasol has described methane-rich gas from its Secunda operations as a temporary bridge from July 2028 to June 2030, subject to customer and infrastructure arrangements. Those measures could reduce the gap, but they do not yet amount to a fully operating replacement system. ^{[8][12][14][15]}

What does “gas cliff” mean in South Africa?

The phrase describes a mismatch in timing: the gas fields and supply arrangements that have fed the inland market are declining, while new import terminals, pipelines, supply contracts and customer arrangements still need to be completed. Different institutions have used different dates because they are describing different contracts, production profiles and exposure points. The term is therefore a useful warning about a transition risk, not a precise date when every gas customer stops receiving fuel. ^[1][2][8]

The government’s Integrated Resource Plan 2025 also assigns a role to gas-fired generation, including a 3,000 MW gas independent power producer programme. That electricity planning target is not itself a gas supply contract or proof that the necessary LNG infrastructure will be ready on schedule. ^[4]

How South Africa’s existing gas chain works

The established inland chain begins with natural gas produced in Mozambique, including the Pande and Temane fields. Gas travels south through the Mozambique-South Africa Pipeline (MSP), operated by the Republic of Mozambique Pipeline Investments Company (ROMPCO), and connects with Sasol’s transmission and distribution infrastructure serving industrial customers in South Africa. ^[5][7]

ROMPCO is a joint venture involving Sasol, South Africa’s iGas and Mozambique’s Companhia Moçambicana de Gasoduto (CMG). It transports gas; it does not control the upstream reserves, and pipeline capacity alone cannot guarantee that sufficient gas is produced, contracted and delivered. ^[6][5]

This distinction matters for reporting. A pipeline can remain operational while the volume available to flow through it falls. Replacing declining field output therefore requires new molecules as well as transport capacity, commercial agreements and compatible customer infrastructure. ^[5][8]

Why the gas users’ association is calling for LNG

The Industrial Gas Users Association of Southern Africa (IGUA-SA) represents large industrial gas users. Its Gas Roadmap for South Africa 2025–2042 argues for urgent coordinated action and presents LNG imports alongside domestic and regional supply options. This is the position of an industry association speaking for exposed users; it should be attributed as advocacy and forecast, rather than described as a government emergency declaration. ^[3][2]

The commercial case for LNG depends on scale. An import terminal, storage and regasification facilities, pipelines and customer connections require large upfront investment. Industrial users argue that reliable anchor demand, including gas-fired power generation, can support the infrastructure and supply commitments needed to serve a wider group of users. The same structure also creates a question about whether LNG delivered at market prices will be affordable for existing industrial customers. ^[2][9][12]

Government has separately identified LNG procurement as part of its response to gas security and is developing a policy framework through the Gas Master Plan process. Industry demands and official policy should be tracked as related but distinct evidence. ^[10][11]

Matola LNG: the Mozambique route to compare with Richards Bay

Matola is a second proposed LNG import route relevant to South African supply. Beluluane Gas Company (BGC), a Mozambique-registered project company, says it holds a concession to import LNG into Matola harbour and develop an FSRU, associated pipelines and truck-loading facilities. Its published concept also connects the terminal to a proposed 2,000 MW power station in the Beluluane Industrial Park. ^[21]

Gigajoule’s project description says a planned 20 km pipeline would connect the Matola FSRU to the Matola Gas Company (MGC) network, which is connected to ROMPCO and the South African market. If built and commercially contracted, Matola could use the existing regional pipeline corridor; it would still require the import terminal, connecting infrastructure, gas supply contracts and available transmission capacity. ^[22][23]

The route must be treated as proposed. BGC’s current public milestone list records a 2019 concession and FEED work completed in 2021, but does not give a current final investment decision or commissioning date. SAI has therefore not counted Matola as firm replacement supply. Richards Bay has a more recent public timetable: ZET now targets a 2028 investment decision, with its phase-two commercial operations date stated as “as early as” the fourth quarter of 2030, subject to FID. ^[21][12]

The projects solve different infrastructure problems. Matola would import LNG in Mozambique and feed the MGC–ROMPCO system; Richards Bay would import LNG directly into South Africa and connect to the planned Lilly pipeline system. The key question is which route can secure binding demand, finance, construction and transport capacity soon enough to serve customers. ^{[22][5][12][18]}

Sasol’s proposed bridge to 2030

Sasol announced that it had confirmed the technical feasibility of supplying methane-rich gas (MRG) from its Secunda operations to external customers for a limited bridging period from July 2028 to June 2030. The company says it is engaging customers to assess volumes and infrastructure compatibility; its announcement describes a proposed solution, not a blanket guarantee that every current customer will receive the same volumes or prices. ^[8]

A bridge buys time but does not remove the need for a longer-term supply source. Sasol has said it is advancing LNG options in parallel, while IGUA-SA argues that import supply and domestic exploration should form parts of a broader response. ^[8][9][2]

Richards Bay LNG: the companies and infrastructure

ZET is the project company developing the proposed LNG import terminal at Richards Bay. The terminal’s project materials describe a first phase based on a floating storage unit and regasification facilities, with a connection intended to feed the Lilly pipeline system and serve users in the Richards Bay industrial area. ZET’s published capacity and commissioning figures are project plans conditional on the required investment decision and delivery; they should not be reported as operating capacity. ^[12][13]

The project is a partnership between Vopak Terminal Durban and Transnet Pipelines. Vopak Terminal Durban is majority owned by Royal Vopak, with Reatile holding a 30% interest in the local terminal partnership; Transnet Pipelines is part of state-owned Transnet. That places international terminal expertise, a South African industrial investor and state-owned pipeline infrastructure around one proposed project. ^[14][19][16]

Transnet has been preparing to repurpose the Lilly pipeline for gas transmission linked to the Richards Bay LNG project. The terminal and pipeline have to work as a connected system: importing LNG at the port is not enough unless gas can be regasified, transported and delivered to paying users. ^[18][13]

The commercial agreements announced in 2026

In June 2026, Eskom and ZET announced a Heads of Agreement establishing a framework for a strategic partnership connected to Eskom’s proposed Richards Bay gas-to-power project. ZET also announced a Heads of Agreement with ExxonMobil South Africa LNG to advance LNG supply discussions. These agreements are material steps in building prospective demand and supply relationships, but the announcements call them Heads of Agreement; they do not establish that the terminal has reached financial close, begun construction or entered commercial operation. ^[14][15][20]

ZET’s current project page targets a final investment decision in 2028 and says pre-FEED is under way, anchor customers have been secured, and commercial agreements and approvals remain among the next steps. Reuters reported in March 2026 that Vopak expected to be ready to take the decision in the first quarter of 2028; the newer ZET page confirms a 2028 target without specifying a quarter. Neither source says the investment decision has already been taken. ^[17][14][15]

Civic Ledger’s companion tracker records the public milestones and separates announced agreements from verified construction and commissioning progress. SAI’s focus here is the ownership, companies and business structure behind the proposed supply chain. ^[20]

Why the project may still miss the supply window

First, a terminal needs a final investment decision and financing before construction can proceed. Second, shipping, storage, regasification and connecting pipelines must be available together. Third, LNG suppliers and buyers need commercial terms that support long-term commitments. Fourth, gas users need clarity on delivered prices and the allocation of scarce capacity. A signed framework agreement is useful evidence of progress, but it does not answer all four questions. ^{[17][14][15][2]}

The timing risk is material. ZET currently targets FID in 2028, while Sasol’s proposed MRG bridge ends in June 2030. ZET’s current page says phase two’s commercial operations date could be as early as Q4 2030, subject to FID; the page does not give a phase-one commercial operations date. This is SAI’s schedule-risk assessment from published milestones, not an official declaration that the project is delayed or impossible. ^[17][8]

The price risk is also material. LNG competes in an international market and must be converted into a delivered South African price after liquefaction, shipping, terminal and pipeline charges. The existence of an LNG terminal would diversify supply, but it would not by itself guarantee that gas remains affordable for every factory currently connected to the inland system. ^[2][9]

Who is most exposed?

Gas is used as both an energy source and a feedstock by parts of South Africa’s manufacturing, chemicals, metals, mining and other industrial sectors. Users connected to the inland pipeline network face a different exposure from a future coastal customer near Richards Bay: they may need pipeline capacity, new contracts, equipment changes or alternative fuels before imported gas can reach them. ^[2][5]

For power generation, the IRP 2025’s gas allocation creates a potential anchor market, but the programme’s capacity target must be matched to actual plants, LNG procurement and network infrastructure. Electricity planning and industrial gas supply are linked by the fuel chain, though neither automatically solves the other’s delivery constraints. ^[4][14]

What to watch next

The most useful public tests are: a formally announced final investment decision; financing and construction contracts; environmental and port approvals; progress on the Lilly pipeline connection; binding LNG supply and terminal-capacity agreements; the volume and duration of Sasol’s MRG bridge; and clear pricing and allocation arrangements for industrial customers. ^{[12][18][8][17]}

A strong report should say which company or public body made each commitment, when it was made, whether it is binding, and what evidence would show completion. South African Index will update this record when new primary documents materially change the ownership, supply or project timeline. ^{[14][15][18][20]}

Frequently asked questions

Is South Africa already out of gas? The public record reviewed here describes a looming supply decline and a transition risk. It does not establish that all South African gas users are currently without supply. ^[1][2]

When will the Richards Bay LNG terminal open? ZET currently targets an investment decision in 2028 and describes phase-one development as subject to that decision. It says phase two’s commercial operations date could be as early as Q4 2030; it does not publish a phase-one opening date on its current project page. ^{[12][17][14][15]}

Who is developing the Richards Bay terminal? Zululand Energy Terminal is the project company. It is a partnership involving Vopak Terminal Durban and Transnet Pipelines, with Reatile holding a 30% interest in Vopak Terminal Durban. ^[14][19]

Will LNG solve the gas cliff? LNG could provide an alternative source if supply contracts, terminal investment, port and pipeline infrastructure, financing and customer pricing are all secured in time. A proposal or Heads of Agreement alone does not prove that outcome. ^{[2][12][14][15][17]}

Is Matola LNG ready to supply South Africa? BGC’s current project page describes a proposed terminal and cites a 2019 concession and FEED work completed in 2021, but gives no current FID or commissioning date. SAI treats it as a proposed option, not available supply. ^[21]