Business Report August 26th Donwald Pressly
Ministers push for fracking in Karoo
THE DEBATE about the impact of hydraulic fracturing, or fracking, in the Karoo has been reignited after the government hinted that the nod for extraction rights will be granted before next year’s national election, expected in April or May.
While the official opposition is keeping an open mind on the process, it believes that hasty decisions should not be made before a charter is put in place to protect the land and water resources in what the Khoisan people call “The Land of the Great Thirst”.
The Freedom Front Plus, which serves in the government, says it will oppose fracking and will take the matter to court to block it, if necessary.
Exploration licences have to be issued before any estimation can be made of the size of the gas reserves, or whether they are economically exploitable.
Deputy President Kgalema Motlanthe and Trade and Industry Minister Rob Davies have described fracking as “game changing”. Davies said he expected a decision authorisingfracking to be taken by the government before the election.
Fracking, which is a process where gas is extracted after cracking open hydrocarbonrich shale by pumping water, sand and chemicals into deep wells at high pressure, has caused a political uproar in the UK after a moratorium was lifted in December last year by Energy and Climate Change Secretary Ed Davey, a Liberal Democrat. The issue has split his party as well as the ruling coalition with the Conservative Party. Protests are centred on Balcombe in West Sussex, where test drilling occurred.
Mineral Resources Minister Susan Shabangu lifted a moratorium on exploration in South Africa last September. Her department has been slow in finalising the regulations applying to the exploration licensing process. Fracking is still illegal.
The US Energy Information Administration estimated that there could be 500 trillion cubic feet of gas in the Karoo, about five times the reserves found off Mozambique’s coast.
A new alliance against fracking in South Africa, which pairs the Treasure the Karoo Action Group led by Jonathan Deal with Afriforum, warned that a decision should not be rushed through before the election. Deal said Shabangu had not carried out her promise to consult with the public prior to making any decisions on shale gas drilling.
Julius Kleynhans, Afriforum’s environmental spokesman, said the government “is selling votes with this move”.
Deal said the fact that the US Environmental Protection Agency had not concluded its report into fracking woes “is a telling sign” in a country where oil and gas activity is commonplace. He said there were questions about the longevity of shale gas resources.
Bloomberg, however, said the federal government had halted its investigation and handed the agency probe over to the state of Wyoming, one of the US’s biggest shale gas producers. The company owning the offending wells, Encana, paid for it. The agency initially linked groundwater contamination to Encana’s fracking wells in Pavillion, Wyoming. It found evidence of methane, ethane, diesel-range organic compounds and phenol.
Meanwhile, Shell South Africa chairman Bonang Mohale, whose company has wells in Pinedale, Wyoming, said Shell SA hoped to be granted an exploration right “within months” and start the official environmental, social and health impact assessment “which will include several scientific studies and formal public participation meetings”.
“Our commitment to listen to the views of the Karoo residents stands. We’ll continue to explain in detail what our plans entail, and discuss the socio-economic benefits that could arise from the project.”