SA’s golden gas opportunity
Oil and gas companies are slashing spending as they reel from the effects of low prices amid the Covid-19 pandemic. But can promising projects in SA and Mozambique make the cut?
Oil fuels economic activity and global movement, and so it is only natural that it finds itself in the crosshairs of the Covid-19 crisis. As oil demand has plummeted amid national lockdowns around the world, so have prices. Brent crude hit multidecade lows of less than $20 a barrel last month, when US prices turned negative $40 over storage concerns as facilities begin to brim.
Now oil and gas majors are slashing expenditure by as much as 30%, cementing capital discipline they have been practising for a while. This comes as investors increasingly abandon the sector over low returns and mounting environmental concerns.