Johannesburg — NATIONAL oil company PetroSA has signed a technical co-operation permit with the Petroleum Agency of SA for the offshore gas block 5/6 in the Orange Basin, along the southwestern coast of SA.

The permit enables PetroSA to conduct geochemical analysis and basin modelling to establish if it should prospect for gas in the area. PetroSA has appointed petroleum and geochemical analysis companies Fugro Robertson and Geotrack to conduct these geochemical evaluations.

The search for gas reserves is a bid on the part of PetroSA to ensure continued supply of gas to its Mossel Bay gas-to-liquids plant. The gas supplies will extend the refinery's life. The offshore gas supplies to the refinery are expected to run out next year.

The company has said that importing liquefied natural gas was its immediate solution for gas supply to the plant. But its negotiations with French energy group GDF Suez for gas supply collapsed earlier this year. The Mossel Bay plant supplies about 5% of SA's liquid fuel needs.

PetroSA on Friday said block 5/6 covers about 93 000 square kms and ranges, in water depth, from 100m to just over 4000m.

The permit, which extends from last month to next July, gives PetroSA exclusivity to apply for an exploration right over the block. PetroSA vice-president of new upstream ventures, Everton September, on Friday said the permit gave it an opportunity to expand in a key location.

"PetroSA is excited at the opportunity to evaluate numerous leads on the existing seismic database," Mr September said.

The company plans to build a 400000-barrels-a-day crude-oil refinery at Coega, near Port Elizabeth.

According to PetroSA, the refinery - also known as Project Mthombo - and the company's other upstream project will see it supply as much as 25% of SA's liquid fuel needs by 2020.