* Shell echoes concerns about changes to law
* Industry had said move would discourage investors
* Explorers interested after nearby Mozambique finds
By George Obulutsa
NAIROBI, April 30 U.S. oil and gas explorer
Anadarko Petroleum said it halted spending on
exploration in South Africa until it has more clarity on changes
in the petroleum law, which gives the state a 20 percent stake
in new ventures.
South Africa's parliament passed the changes to the law last
month, a move industry experts said would discourage investment.
Other firms have also voiced concerns about the legislation,
which gives the mines minister wide-ranging powers to place
certain minerals in a "value-addition" category, which means a
portion would have to be processed domestically instead of
exported in raw form.
"We have suspended our expenditures in South Africa until
the petroleum law and fiscal terms are more clear," Tom
Fletcher, exploration manager for east Africa at Anadarko, told
an energy conference in Nairobi on Wednesday.
Speaking to reporters on the conference sidelines, he said:
"We are just looking for a little more clarity - what's going to
happen with the fiscal regime down there - before we invest
large dollars in South Africa."
Menno de Ruig, Shell's exploration manager for new
international upstream business in sub-Saharan Africa, echoed
those concerns at the conference.
"We are hopeful that the current uncertainty around the
petroleum bill in South Africa gets resolved in a workable
manner so that we can move forward to the drilling phase," he
The speed at which the bill passed before elections in May
alarmed petroleum companies such as Shell, Anadarko, Total
and Exxon Mobil, which want to explore South
Africa after making big offshore gas finds in neighbouring
Shell has been exploring for shale gas in the onshore Karoo
area, while Total said in November it expected to drill its
first offshore well in the Outeniqua Basin, about 175 km (110
miles) off the southern coast of South Africa.
As well as the 20 percent "free carried interest", the
government also introduced a clause entitling it to increase its
share of a project by acquiring a greater stake at an agreed
price or by production-sharing agreements.
Industry critics of the law say it amounts to
nationalisation without appropriate compensation.
(Editing by Edmund Blair and Jane Baird)