Shell South Africa said yesterday that the future of its investments into oil and gas exploration on the Wild Coast would be determined by the outcome of today’s Supreme Court of Appeal (SCA) hearing in which fishing communities and environmental groups are interdicting the company’s offshore exploration activities.
This comes as Shell South Africa has recently announced that it was exiting its downstream business operations in South Africa, although it would still retain its investments in the country’s upstream and offshore activities.
One of these activities is the exploration for gas and oil on the pristine Wild Coast in the Eastern Cape province.
Although the government approved Shell’s exploration activities on the Wild Coast, the Makhanda High Court prevented the global energy firm from continuing with exploration activities in the area, deemed an environmentally sensitive zone.
Environmental, fishing and other groups who say they are being affected are opposed to the company’s exploration activities, saying these operations disturb marine wildlife, with ultimate impact on the environment as well as fishing activities that sustain communities.
Shell South Africa spokesperson Pam Ntaka yesterday said the company was awaiting the outcome of the SCA hearing, with any further investment decisions hinged on the court’s decision.
“Future decisions related to this offshore block will be subject to the outcome of the appeal and a review of options open to the venture,” Ntaka said by email to Business Report.
Although the company is still maintaining investments upstream, it could be faced with challenges as the government could become more reluctant to grant it permits and licences for upstream operations.
Nonetheless, the company has to clear today’s court hurdle at the SCA in Bloemfontein.
Various environmental and community groups told Business Report yesterday that they will be picketing at the SCA against Shell’s offshore exploration activities.
The Botshabelo Unemployment Movement (BUM) said it recognised the interconnectedness of community struggles against environmental degradation and economic disenfranchisement.
It said the exploitation of natural resources often went hand in hand with the exploitation of marginalised communities, exacerbating cycles of poverty and ecological devastation.
“Shell’s actions will not only jeopardise the delicate ecosystems upon which these communities depend, but will also undermine their fundamental rights to a clean and healthy environment,” it said.
“We will be picketing with fishing communities whose lives are in immediate peril due to the health of our oceans and waterways.”
The Amadiba Crisis Committee said Shell’s blasting with airguns in the ocean outside the Wild Coast was of great concern.
“It will disrupt marine life, and continue the exploration for gas and oil under the seabed despite the ongoing climate crisis. Shell has never talked to us or any other coastal community about it,” it said.
Shell Petroleum and the Department of Mineral Resources and Energy (DMRE) have appealed against the interdict which halted the energy group’s exploration activities offshore.
Cromwell Sonjica, a local community leader and campaigner against Shell’s intended exploration activities on the Wild Coast, said his concern was that the environment would be disturbed by the company’s activities.
“The ocean is our source of income,” Sonjica said in an interview with Business Report.
“The exploration they were to do would have a negative impact on our way of life and to the marine life and there was no proper consultation or engagement as we only found that they were about to do seismic exploration two months before it started.”
Shell said South Africa was highly reliant on energy imports for many of its energy needs.
“Should viable resources be found offshore, these could significantly contribute to the country’s energy security and the government’s economic development programmes,” it added.
BUSINESS REPORT