Petroleum Africa
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Friday, May 2, 2014
The changes in South Africa’s petroleum laws have given foreign operators pause when it comes to their operations there, in fact one company, Anadarko Petroleum, said it halted spending in the country until it has more clarity on the changes in the law.
“We have suspended our expenditures in South Africa until the petroleum law and fiscal terms are more clear,” Tom Fletcher, exploration manager for East Africa at Anadarko, told an industry event in Nairobi. Speaking to reporters on the conference sidelines, he said: “We are just looking for a little more clarity – what’s going to happen with the fiscal regime down there – before we invest large dollars in South Africa.”
The country’s parliament passed the law last month in record time, leaving more than one expert on the industry in Africa stating that investment would be discouraged by such a law. The new law gives basically gives the state a free carry of 20% in new ventures. As well as the 20%, the government also introduced a clause entitling it to increase its share of a project by acquiring a greater stake at an agreed price or by production-sharing agreements.
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