How the Upstream Petroleum Resources Development Bill is fueling SA’s economic potential
Oil and gas are distinct markets and have very specific requirements.
The new regulatory provisions currently proposed under the Upstream Petroleum Resources Development Bill (UPRDB) aims to separate the regulation of the upstream petroleum sector from that of the mining sector. Currently, the UPRDB is undergoing parliamentary review and approval processes before it is passed into law.
Although this is a key industry for the South African economy and impacts both people and provinces, the danger is that the government is technically able to pass this bill without public participation.
Amore Carstens, Associate in the Oil and Gas sector at CDH, says this is offset by the fact that South Africa generally promotes a culture of ensuring the public are involved, particularly from an investor perspective. She says bills of this nature, especially ones that affect the provinces, are generally referred to for public participation.
The provisions put forth by the bill are encouraging of competition and should be attractive to potential investors.
From the first iteration in 2019, to the second one in 2021, he/she says there is definitely a concerted effort to take on board the concerns and considerations of the industry.
The bill still has a way to go, and the team believes the process will in all likelihood remain transparent and easily accessible to the industry.
Also in need of discussion are the following points:
The journey the bill needs to go through to get passed and why it has been encouraging for the South African economy
What improvements have been made in this new iteration of the bill
How the bill should balance promoting foreign investment in South Africa and enable local companies
What foreign investors will be looking for in this bill
How the business, provincial and national interests need to be balanced