Altona acquires majority stake in Monte Muambe company
Money Web / SacOil CEO Thabo Kgogo
The South African company SacOil Holdings has held back from signing a joint venture agreement for the development of a gas pipeline from the Rovuma Basin in the far north of Mozambique to South Africa’s Gauteng province.
SacOil is part of the African Renaissance pipeline project consortium planning to build a 2,600 kilometre pipeline to transport gas from the north of the country to South Africa, with spurs along the way to support national development, but its name was notable by its absence from the agreement signed in Maputo on Friday.
The other members of the consortium adopted the joint venture agreement. It was signed by Profin Consulting (represented by its Chief Executive Officer, Olivia Machel); Mozambique’s National Hydrocarbon Company, ENH (represented by Martinho Tavares, of its Board of Directors); the China Petroleum Pipeline Bureau, CPP, and the China Petroleum Technology Development Corporation (both represented by their deputy chairpersons, Chen Qingxun and Yun Wei), and the South African company Progas Investment (represented by Nhlanhla Magubane).
According to a statement released by Sacoil, the company “elected not to sign the joint venture agreement at this time, while the Board evaluates the agreement and the associated opportunity with regards to the Company’s participation in the Project”.
However, the company’s chief executive, Thabo Kgogo, told the news agency Bloomberg that “we are still in the project”. He explained that “the Board felt we didn’t want to rush the process”.
SacOil is 42 percent owned by the Public Investment Corporation (PIC) which manages the bulk of the pension money of South African government workers and is the continent’s biggest fund manager. The chairperson of its board is Tito Mboweni, a former governor of the South African Reserve Bank.
The two Mozambican partners hold a 56 per cent of the stake in the pipeline project, whilst Chinese companies hold twenty per cent and South Africa companies 24 per cent.
The project viability studies, estimated to cost 45 million US dollars, will be financed by CPP. The total cost of the pipeline is put at six billion dollars, and China will provide credit for 70 per cent of this (4.2 billion dollars). The project will be financed without any funds or guarantees from the Mozambican government.
This is one of two proposals for a pipeline from the Rovuma Basin southwards. The other project is known as “Gasoduto Norte ao Sul” (GASNOSU) and is led by the South African Gigajoule Group.
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