Licences to explore for shale gas in the Karoo look unlikely to be issued this year because a multi-departmental task team drawing up the regulations to govern the process is still being formed. It is now generally accepted that the licensing process is likely to begin only at the end of next year.
Mosa Mabuza, the deputy director-general for policy in the Department of Mineral Resources, said the task team was still “at the stage of augmenting the regulations to set up an appropriate regulatory regime for the development of shale gas”.
The team needed to balance economic development potential with “social and environmental responsibility”.
The team included Mabuza’s department as well as the departments of Energy, Science and Technology, and Environmental Affairs.
Once this process had been concluded “we can have a conversation around licensing and those developments”, Mabuza said, noting that the department could not process applications for exploration licences while this regime had not been completed.
The mineral resources ministry lifted a 15-month moratorium on shale gas exploration in September last year.
It is envisaged that the gas will be extracted by hydraulic fracturing – or fracking – involving pressurised water with chemicals and sand being blasted kilometres underground to release trapped gas from the shale rock.
Some landowners in the Karoo and environmentalists argue that the process will damage the environment.
Energy Department director-general Nelisiwe Magubane noted that fracking became her department’s baby only once gas was extracted, leaving the licensing process for the underground gas with the Mineral Resources Department.
She said the government was looking at imports of liquefied natural gas as an interim energy source. Fracking for shale gas exploitation was “a medium- to longer-term” project, she said.
Shell South Africa, Bundu Gas & Oil and Falcon Gas & Oil are among the international oil companies that have requested exploration licences.
Last year a Mineral Resources Department task team reported that the US Energy Information Administration’s estimate of a “technically recoverable” shale gas resource of 485 trillion cubic feet of gas was possible.
But the Petroleum Agency SA said it was impossible to quantify the resource from the available data.
Last September Mineral Resources Minister Susan Shabangu emphasised that the green light had not been given to fracking at that stage – only what she called “normal” exploration, including geological field-mapping and data-gathering activities.
Janine Nel, a Shell spokeswoman for upstream activities, said her company hoped to be granted an exploration right within months. “Shell is investing significant resources globally in developing natural gas as a cleaner energy source.
“We will continue to work closely with the people of the Karoo… to address concerns and ensure they benefit from shale gas exploration.”
Shell pledged to hold frequent public meetings once the official environmental, social and health impact assessment of shale exploration was completed.
Referring to Orange Basin, the gas exploration area off the northern Cape coast, she said Shell had carried out a seismic survey of its block between October and February covering about 8 000km² some 250km south-west of the settlement of Kleinzee.
“The results from the survey are currently being assessed.” – Donwald Pressly