South Africa to Buy LNG from the US

(3 Minutes Read)

SA will import 75 – 100 PJ (petajoules) per annum for 10 years of LNG gas from the US, which will unlock approximately USD 900 million to USD 1.2 billion in trade per annum and USD 9 billion  -USD 12 billion for ten years based on the applicable price.

 South Africa has offered to buy liquefied natural gas (LNG) from the United States in a trade deal proposal that would see the African nation become exempt from paying duties on vehicle exports to the United States in return.

The proposal was announced in a statement by Khumbudzo Ntshavheni, Minister in the Presidency of South Africa. SA will import 75 – 100 PJ (petajoules) per annum for 10 years of LNG gas from the US, which will unlock approximately USD 900 million to USD 1.2 billion in trade per annum and USD 9 billion -USD 12 billion for ten years based on the applicable price, the statement read.

While the United States has so far not decided on accepting or rejecting the deal, it could be a means for Pretoria to protect its struggling economy and to some extent repair relations with Washington, which are at their worst point in years. The automotive industry and vehicle exports are a particularly important sector in South Africa’s economy, representing approximately 5% of its GDP.

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U.S. President Trump previously threatened South Africa with 30% tariffs on its exports to the U.S.