Click to edit Master subtitle style 2/16/12 PORTFOLIO COMMITTEE ON ENERGY BRIEFING ON INTERNATIONAL ACTIVITIES OF THE DEPARTMENT OF ENERGY

Click to edit Master subtitle style 2/16/12 Introduction  Factors that drive and guide energy sector international relations  The Department’s approach to international relations – tenets  Department’s International Relations Strategy  Security and continuity of the country’s energy supply (oil, gas and electricity)  Diversity of the energy mix  Climate change imperatives  Role in Africa and Southern African Development Cooperation (SADC) in particular  Bilateral and multilateral relations pursued by Department of Energy (DOE)  Participation in global energy bodies  SADC Power Pooling – Southern African Power Pool (SAPP)  Conclusion

2/16/12 3 FACTORS THAT GUIDES AND DRIVE THE ENERGY SECTOR INTERNATIONAL RELATIONS Access to information Upward pressure on cost of energy Climate change (Clean energy) Access to technology Skills and capacity Energy security Access to energy resources Diversity of supply Safety Access to funding Energy sector Internation al cooperation

2/16/12 Securing energy supply Current situation oil and gas sector 60% - 70% of our oil supply comes from the Middle East and most of the gas from the Republic of Mozambique DOE engagements focused on ensuring diversity and security of supply, access to producing and near producing asserts first on the African continent and elsewhere and ensuring affordability and accessibility of energy products 44

2/16/12 Securing Energy Supply Access to assets to diversify sources of supply for oil:- Engagements with the following countries are in progress to secure new supply relations Venezuela, - PetroSA secured blocks and is working on marginal blocks 2009 implementation in progress Egypt- signed an MOU on Oil and gas and developed an implementation plan in 2010 Ghana- drafted an MOU on Oil and Gas and now signed in September, 2011 and working on an implementation plan Algeria –signed an MOU in 2010 on Oil and Gas- and PetroSA working on an implementation plan 55

2/16/12 Securing Energy Supply RSA and Mozambique Gas Commission – promoting gas development and trading between the countries RSA and Namibia Gas Commission to promote development of gas assets Republic of Angola -PetroSA and Sonangol exploring areas of Cooperation in the oil and gas and currently exploration potential projects of commercial interest Increase trading in petroleum products with the African continent mainly- Angola and Nigeria (crude trading) and Mozambique – gas.. 66

2/16/12 Securing Energy Supply MOU between PetroSA and SINOPEC ( 30/09/2011) The MOU allows the two companies to explore the possibility of working together to development the Mthombo project, conduct exploration and production, engage in wholesale trading and distribution of petroleum products in South Africa and crude trading in general. MOU between PetroSA and PDVSA- Venezuela- access to near producing and near producing assets 77

Click to edit Master subtitle style 2/16/12 Clean Energy and Climate Change President Zuma through the Copenhagen accord has committed GHG reductions by 34 by 2020 and 42% by 2025 under business as usual and subject to available resources. South Africa is one of the major emitters and the energy sector contributes 80% of emissions In line with mandate the DOE has reviewed policy and international engagements to enable alignment with the climate change mandates

Click to edit Master subtitle style 2/16/12 Clean Energy and Climate Change International Activities to - Promote engagements to enable the DOE to meet clean energy initiatives through multilateral engagements: approved participation in the International Partnership for Energy Efficiency Cooperation to assist in Capacity building in the energy in EE, sharing information, policy development etc Carbon Sequestration leader ship Forum-Attended to CCS– special focus on clean coal technologies Deploy clean coal technologies – CCUS – Australia, UK, Norway Establishment of the CCS and the Carbon Capture and Storage Atlas with the assistance of international funding from bilateral and multilateral organizations

Click to edit Master subtitle style 2/16/12 Clean Energy Ministerial Spearheaded by the USA – Major Economies Forum (24 countries participate) RSA is the Ambassador for Clean Energy in Africa Global forum promoting policies and programs that advance clean energy technologies A total of 11 initiatives supported by the CEM, and RSA is a member of the following: Multilateral Solar and Wind Working Group Global Superior Energy Performance Partnership (GSEP) GSEP aims to reduce global energy use in industrial facilities focus on cement, steel and energy management

Click to edit Master subtitle style 2/16/12 Clean Energy Ministerial Energy Efficiency Initiative Electric Vehicle Initiative Carbon Capture use and Storage Action Group Solar and LED Energy Access Programm e Clean Energy Education and Empower ment Women Initiative (C3E) Smart Grid initiatives Super Efficient Appliance and Deployme nt Initiative - SEAD

2/16/12 Securing Clean Energy Supply Bilateral initiatives:- MOU between the RSA and the Kingdom of Lesotho in Energy Resources in the field of Energy Resources – 27/10/2011 Renewable energy potential in the Kingdom of Lesotho (wind and hydro is substantial and the country is keen to work with RSA 1212

2/16/12 Clean Energy MOU between the Government of the Republic of South Africa and the Government of the Democratic Republic of the Congo (Grand Inga) 12/11/2011 The MOU paves the way for developing a Treaty between the two countries which will enable South Africa and the DRC together with other countries to exploit the potential of the Grand Inga to generate approximately 40000MW of hydro electricity. 1313

2/16/12 Clean Energy MOU between the Government of the RSA and the Government of the Kingdom of Denmark in the fields of renewable energy and energy efficiency. Denmark is a global leader in wind energy and through this agreement it is assisting RSA to develop a wind awareness campaign, development of wind atlas, skills and technology transfer. 1414

Click to edit Master subtitle style 2/16/12 Bilateral Relations of Note Department singed and MOU with Peoples republic of China - Energy Sector signed MOUs which enabled the energy sector to access funding as well as PetroSA to forge relations with Chinese companies Signed an MOU which paves the way for PetroSA to work with experienced Chinese oil and gas companies in the upstream sector and also their participation in the PetroSA infrastructure projects in the country An Energy forum has been initiated with China where officials and business meet once a year to review implementation of the MOU and ensure that there is company to company cooperation and investment in the sector.

Click to edit Master subtitle style 2/16/12 Bilateral Relations of Note A number of companies have signed business agreements with Chinese companies to invest in the energy sector in RSA and projects are being monitored to ensure that there is:- - mutual benefit, alignment to the job creation initiative, the compliance to IPAP 2 -localisation imperatives and - technology transfer as well as - skills development in all investment projects.

2/16/12 African Energy Ministers Conference (AEMC ) In preparation for COP 17, the DOE held several events including (AEMC) attended by more than 45 countries. The Ministers from the continent outlined projects of priority and made a conscious decision to support climate change initiatives through deployment of sustainable energy programs Highlighted the need for funding, technology & skills transfer. 1717

2/16/12 Nuclear The Department has relations with multilateral bodies that promote the safe use of nuclear and adhere to the principals of non-proliferation. The Department has taken active interest and followed up on the Fukushima Nuclear disaster with the aim of learning from the accident Bilateral engagements have been conducted and agreements concluded with Algeria, Korea and China and currently exploring cooperation with other countries such as Uganda. The Department has benefited from exchange of information, capacity building from bilateral and multilateral relations 1818

2/16/12 Access to funding Declaration of Intent (DOI) on the South African Renewables Initiative This DOI enables the South African Government to access soft loan from signatory countries and institutions to support deployment of RE The MOU will also facilitate job creation technology transfer and localisation Denmark, UK, Germany, Norway and the European Investment Bank have signed and will be committing funds to the initiative 1919

2/16/12 Access to funding Agreement between the Government of the RSA and the Government of the People’s Republic of China (China Development Bank Corporation) on cooperation in the energy sector China Development Bank Corporation set aside US $20 billion for investment in the energy sector in RSA. 2020

2/16/12 CAPACITY BUILDING All the agreements that the DOE signs have a component of information sharing and capacity building Change in technology and quest for new energy technologies necessitates training and ensuring the country state of readiness to deploy new technologies (renewable energy, Carbon Capture & Storage) MOU with the International Energy Agency (2011) to promote capacity building and support in energy planning and research- implementation plan has been signed off and training under this agreement initiated. International Atomic Energy Agency – provides extensive training for the sector 2121

2/16/12 SADC Regional initiatives Energy Ministers Annual Meeting Approved development of a renewable energy strategy for SADC, infrastructure development master plan Alignment of regulatory policies to ensure trade and investment regionally e.g. Regional Electricity Regulatory Authority Conducted capacity building workshops on energy for example clean development mechanism led by RSA, on biofuels and food security, and data collection South Africa supporting the establishment of designated national authorities in the region Promotion of regional electricity interconnectivity and support to the Southern African Power Pool (SAPP) and rela ted projects 2222

2/16/12 DEMAND AND SUPPLY SITUATION 2323

2/16/12 SADC POWERPOOLING Critical For Capacity Adequate Reserve Margins 2016 Critical For Energy

2/16/12 SADC POWERPOOLING Power trading is possible in the SADC region but there is need to create an enabling environment. With SADC, governments, utilities, developers have identified that problems exist in the enabling environment (e.g. financing, security of supply, regulation, pricing) for long-term cross-border power trading Map shows a number of potentially viable cross-border projects 2525

2/16/12 SAPP Transmission Projects 2012 DRC - Zambia 2013: ZIZABONA - 220/33kV 2013: Mozambique Malawi 2014: Zambia - Tanzania kV 2016: MOZAMBIQUE BACKBONE -RSA 2015 : RSA Strengthening 2017: Namibia – Angola 2626 DRC Tanzani a Mala wi Zimbabw e Mozambiq ue Lesoth o Swazilan d South Africa Botswan a Namibi a Angol a Zambi a

2/16/12 Overview of Regulatory Decisions for Cross Border Deals 2727

2/16/12 SADC APPROVED ENERGY INFRASTRUCTURE PROJECTS Transmission Backbone in Mozambique HCB North Bank in Mozambique Mpanda Nkuwa Hydro Power Project in Mozambique Batoka Hydro project in Zambia and Zimbabwe Kafue Gorge Lower in Zambia Kariba South Extension in Zimbabwe Kudu Gas Power Project in Namibia 2828

2/16/12 SADC APPROVED ENERGY INFRASTRUCTURE PROJECTS Zambia – Tanzania – Kenya Interconnector Mozambique – Malawi Interconnector Namibia – Angola Interconnector DRC – Angola Interconnector ZIZABONA Interconnector Central Transmission Corridor (CTC) in Zimbabwe Kafue – Livingstone Transmission Upgrades 2929

2/16/12 SADC REGIONAL PROJECTS 3030

2/16/12 Conclusion The DOE has initiated both multilateral and bilateral relations that focus on ensuring that the country has access to Secure, affordable and accessible energy Access to funding, technology & technology transfer Skills to be able to deploy technology intensive projects, promote localisation and job creation & Embraces the African continent and SADC region South – South Cooperation and North - South in line with DIRCO policy 3131

2/16/ Thank you