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Date : 31/08/2004
Source: Western Cape Provincial Government
Title: L Brown: Cape Oil and Gas Supply Initiative


SPEECH BY LYNNE BROWN, WESTERN CAPE MINISTER OF FINANCE, ECONOMIC DEVELOPMENT & TOURISM, AT THE LAUNCH OF CAPE OIL AND GAS SUPPLY INITIATIVE (COGSI), 31 August 2004

Good Morning,

It is with great excitement and anticipation that today we finally launch the Cape Oil and Gas Supply Initiative or COGSI. I am sure that most of you here are well aware that this signifies the culmination of efforts from a partnership and working relationship that has been functional for almost three years now.

When one considers the importance and potential of the offshore oil and gas industry, one realises that launching an initiative like COGSI is an opportunity worth pursuing.

For instance West Africa is viewed as the fastest growing exploration and production (E&P) area in the world. The United States (US) senate committee has recognised this and about two years ago, they took a decision to source 25% of their oil from Africa by 2015.

And there are plenty of opportunities. The US annually spends about $10 billion on oil in West Africa. And there are vast reserves of oil as well. Nigeria produces more than 2 million barrels of oil per day. Their aim is to produce 3,2 million barrels a day.

Closer to home, Angola produces more than 1 million barrels per day and they are aiming for 2 million barrels.

This industry has the potential to sustain up to 10 000 new jobs over the next 10 to 15 years and certainly poses one of the greatest manufacturing opportunities in our country.

Not only does Cape Town offer the biggest port in the region, but also by far the best industrial back-up. Engineering and other marine and mining related capacity of Western Cape and South African companies offer expertise that is completely unmatched elsewhere on the continent.

The stable and English speaking business environment, as well as good transport and communications infrastructure make South Africa by far the most attractive position on the sub-continent.

To fully maximise the opportunities that present themselves our infrastructure and skills must match demand and expectations.

While this industry offers an arena of tremendous opportunity, it is also an arena of unforgiving scrutiny and competition. It will certainly require the absolute optimum utilisation of all the expertise in the province, and indeed the country, to turn the challenge of positioning the Western Cape as an oil and gas service hub into a success story.

We know full well that we need the very close co-operation of all our local companies and of the industrial giants in Gauteng and other parts of the country to make COGSI a success.

While COGSI has a clear provincial focus, it should however establish itself as the national focal point for the implementation of programmes to develop the capacity of the Western Cape as the conduit for all that the country can offer to this industry.

Having recognised this, the Department of Trade and Industry has now established a National Oil and Gas Task Team. This task team has senior representation from all relevant national departments and will provide strategy and policy leadership to this initiative. It will also enhance and co-ordinate Government's role, which is to enable this drive toward establishing the Western Cape as a credible and recognised offshore oil and gas hub.

With this in mind, we have provided funding of R3 million for COGSI to kick-start some of its activities.

COGSI faces a daunting challenge. In a short space of time the organisation must draw up a plan that markets the Western Cape as a venue with outstanding ports that can serve the offshore oil and gas industry.

The establishment of COGSI is a signal of our commitment to make the Western Cape more prepared for the benefits presented by the oil and gas boom along the West Coast of Africa. It is a signal that we are aware of the need to have the proper infrastructure, skills and business acumen to fully exploit these opportunities.

The oil and gas industry is highly specialised and investment in it, is only possible if the potential for sustainable business is clearly mapped out. COGSI must provide this map.

I thank you.

Enquiries: Thabo Mabaso
Media Liaison Manager/Spokesperson
Tel: (021) 483 3531
Fax: (021) 483 3892
Cell: 083 414 8144
E-mail: thabo_m@hotmail.com
Issued by: Department of Finance, Economic Development & Tourism, Western Cape Provincial Government
31 August 2004

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