PetroSA selling off equity in its offshore blocks

PetroSA, the country's cash-strapped national oil and gas company, has announced it is intending to sell as much as 49% equity stakes in 10 of its offshore blocks.

Stakes for sale include between 10% and 20% of the entity's current equity holding of 40% in Block 1 on the West Coast. An exploration well is planned for 2017 to test prospectivity in this block, which is situated in an area where both Shell and Anardarko have been undertaking evaluations.

Speaking at an African oil and gas conference in Cape Town recently, a PetroSA spokesperson said:

"PetroSA intends to farm out its equity interests in various blocks in South Africa to a technically and financially robust partner(s)."

PetroSA has also been trying to farm out stakes in its Block 9 North, located close to its under-performing gas-to-liquid refinery at Mossel Bay. According to PetroSA, some 1.2 trillion cubic feet of gas and 120 million barrels of oil/condensate has been recovered, with the estimated remaining potential more than 3 trillion cubic feet of gas.

Earlier this month, PetroSA tabled its annual financial statements to Parliament, and confirmed a record loss of R14.5 billion for 2015. The size of the loss had been a bone of contention for months, polarising the Department of Energy and MPs on whether PetroSA executives or board members should bear responsibility for the loss.

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