Demand for liquefied petroleum gas (LPG) in South Africa is growing at an alarming rate that could see the market surge by 50% by 2030, a major distributor has revealed.
Atose Aguele, managing director of Avedia Energy, one of South Africa’s major cooking gas suppliers, told Business Report that one of the reasons why LPG prices were high in the region was because of the growing demand for the fuel.
According to Aguele, South Africa consumes about 500,000 tons of LPG yearly, with 100,000 tons consumed in the Western Cape alone.
To tap into this opportunity, the Cape Town based gas company is building new pipelines to boost supply.
This comes days after it marked a major milestone in South Africa’s gas sector by receiving its first shipment of imported LPG at its terminal at the Saldanha Bay.
Saldanha Bay is expected to make up 16% of the LPG market in the Western Cape region.
The company says the move will help bring down gas prices and provide cleaner energy, especially for low-income households.
“This will change the game. LPG has been too expensive. We want to make it cheaper and more accessible for ordinary people.”
“Most poorer families use paraffin [Kerosine] because LPG is costly, but it’s not as clean or safe,” he noted. “LPG is cleaner and can be used for cooking, farming, and industrial purposes.”
When the channelling systems are completed, the Avedia facility in Saldanha Bay will supply three provinces:
- Western Cape
- Eastern Cape
- Northern Cape.
“Businesses in the Western Cape used to truck LPG all the way from Richards Bay. That was costly. Now they can save money,” Aguele assured.
This assurance seems to align with an earlier report that suggested that Avedia’s entry will fill infrastructure gaps in the local LPG market.
In South Africa currently, Avedia has an 8,000-ton LPG terminal, the first of its kind along the Western Cape coast, and a modern bottling plant in Airport Industria, Cape Town.
Energy analyst Ruse Moleshe of RUBIK said more LPG infrastructure was needed to secure energy for homes and industries.
South Africa faces an imminent gas shortage, not just in LPG but also in LNG.
In his recent state visit to the US, President Cyril Ramaphosa proposed a 10-year LNG supply deal to Trump as part of measures to avert a future gas crisis and mend a sour bilateral relationship.
The proposed agreement involves importing between 75 to 100 million cubic metres of LNG annually from the U.S., a deal that could help unlock up to $1 billion in annual trade between Pretoria and Washington DC.
South Africa presently relies heavily on piped natural gas from Mozambique, where supply is projected to start declining before 2030.