Today saw the price of oil reach the $96 a barrel mark. We are not too far away now from seeing the price reach $100 as many analysts have predicted. But could there be some relief to all of this for South Africa? Deputy President, Phumzile Mlambo-Ngcuka, today officially opened a new plant in Saldanha Bay, on the west coast of South Africa, which aims to service the booming offshore oil and gas exploration industry in South Africa.

It is believed that the 220 000 square metre Saldanha Offshore Fabrication Centre will tap into the growing West African offshore oil and gas industry. The plant is funded by the German-based vehicle and machine manufacturers, MAN Ferrostaal, and operated by Grinaker LTA.

Contrary to many peoples beliefs, South Africa actually produces some of its own oil and does not solely rely on oil imports from the Middle East. To date, oil is flowing from the Sable oil field, located 95 kilometres off South Africa’s southern coast and 150 kilometres southwest of Mossel Bay. Oil is also being extracted from PetroSA’s two existing oilfields – Oribi and Oryx in South Africa. Now with the new investment in the Saldanha Offshore Fabrication Centre, South Africa could be seeing more local production of oil and this could mean lesser imports of oil in the future.

This should certainly help the South African economy but this will not have a large impact on the world oil prices which at the end of the day will determine how much we pay at the pump when filling up our tanks. Dealers say the world’s thirst for oil is climbing towards a peak as winter arrives in the northern hemisphere. OPEC is blaming speculators, political tensions and a weak US dollar for driving up the cost of fuel and have resisted calls for more oil.

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