SA Shale Gas – a gamble on a house of cards


The latest instalment in a running online debate with @davidjohnson. My response, penned January 02 follows underneath.

Why gamble at all?

January 1, 2014

This is the fifth of five articles in a public debate with Jonathan Deal. The exchange began with my piece We can’t treasure only the Karoo, followed by Jonathan’s David Johnson gets his answer on fracking, my reply A response to Jonathan Deal and Jonathan’s most recent article Are the pro-frackers in SA ready to roll the dice?.

Jonathan has described the scene at a hypothetical casino, with environmentalist and developer players gambling on our planet’s future. There is one gamble which TKAG could help remove from this debate. If this exchange starts that process, it could be a very good thing indeed.

Jonathan referred to developers who “claim a loftier cause”. But when a company suggests it is part of some noble project, surely only the most naïve of people would think the claim anything but a marketing ploy. The game played by the oil and gas sector is financial; they seek loftier profits, not loftier causes. The rival players are other oil and gas companies, their gambles are where to invest to generate the greatest returns. We all know this. To the extent environmentalists feature in this imaginary game they are not competitors, but potential impediments to them.

The game of environmentalists, on the other hand, is an entirely different one. They seek to limit or prevent environmental harm, but they do not necessarily agree on how to do so. Many environmentalists are horrified by nuclear power, yet well respected environmental writers and activists like George Monbiot, Mark Lynas and Stephen Tindale support it. On both the nuclear and fracking questions the environmental movement does not possess a unified voice, there are rival players. No environmental interest group can honestly claim to represent “environmentalists” as a whole, on these topics.

Anti-fracking lobby groups, like TKAG, are therefore gambling that their view is the right one and that meeting our energy needs with shale gas would cause greater environmental harm than alternative methods. They are gambling because they lack a scientific analysis supporting their case.

Jonathan refers to the “absence of an open, agreed, inclusive strategic environmental assessment of the real contribution to be expected from the exploitation of South African shale gas for the South African economy, under South African conditions”. I doubt he would trust an assessment prepared by the government or industry, with good reason, so why doesn’t TKAG commission one?

If a diverse panel, not weighted in favour of any particular interest group, agreed terms of reference for experts to undertake a scientific study of our energy options, their full array of lifetime impacts (at home and abroad) and conclude with a hierarchy of the least environmentally damaging actions, there would be the foundation of a far more powerful and rational environmental argument. Maybe the report would support a total ban on fracking, maybe not, we would have to wait to read it.

If this report supported TKAG’s view their case would be strengthened, they would be gambling no longer and many of my criticisms of TKAG’s approach would be wrong. Alternatively, if the report found different conclusions, TKAG would either have to change its focus or admit to having only localised concerns which did not benefit environmentalism on a greater scale.

Commissioning such a project would be time consuming and expensive but would provide a far more persuasive environmental case than is possible at present. If it leads to a stronger environmental argument it doesn’t matter if either my or Jonathan’s views are wrong, the prize of better serving the environment would surely be worth any personal embarrassment. Why gamble on the correct environmental approach? So, Jonathan, I’ll throw the dice if you will. How about we try it?

Jonathan’s response

Gamble (noun) lose or risk losing something, endanger something, risky action

As it turns out, the theme of gambling, with reference to the debate on shale gas mining in South Africa, dovetails perfectly with the approach of our government to this vast and complex issue. And it is appropriate that on behalf of TKAG and those opposed to shale gas mining in South Africa, I embrace this opportunity to play open cards.

As a point of departure, it will be useful to understand the other players and their positions. Minister Shabangu, who by virtue of South African taxpayer’s money has a free seat at the table, wields a special dispensation to break the rules at any time. Arriving late for the game, she grabbed a handful of cards out of the pack, and to date refuses to show her hand. Every now and then, she tosses out a card to show that she is still in the game, and proclaims loudly to the table that she has the money and authority to see this game to the bitter end. Of course, the consequences of a loss for her are of no real consequence, because the taxpayer will pick up the bill.

Shell, who started the game, play with a flamboyant style. Cleverly, they seek to bluff the other players by appearing to have the interests of the game at heart. In truth, their sleeve is well stacked with hidden aces – friends in high places[1] all around the world. Naïve as it may seem, the other players believe Shell when they claim to be in the game for the good of South Africa. If we win this game, they promise, the 9 million South Africans who use dung and candles for energy will all have electricity. The electricity will be cheaper, and between 300 000 and 700 000 unemployed South Africans will have permanent jobs. All you need to do is kick those who would deny all of these benefits that our hand will deliver, out of the game. Trust us, we have honest faces.

Uncle Jacob, just like Uncle Sam, is also in the game. He plays a powerful hand because he can start and stop the game at will. But right now he is enchanted with the shining promises of Shell. Shell has a pot of money that appears to have no bottom, and uncle Jacob, needs money to make good on the promises he made to all the people who paid for his place at the table. Uncle Jacob has many assistants to carry his cards to and from the table – and he brooks no dissent – if you don’t carry the right card, you’re out – and he will replace you with someone who does things his way.

Big business, the Corporatocracy[2], is represented by people who will stand to gain much in the short term. They’ll sell trucks, earthmoving machines, tankers, tyres, diesel, wire, steel, glass, clothing and lots of other materiel. Their role in the game is to nudge Uncle Jacob and his card carriers. Every time it looks as if the spoilsport Enviroplayer has strengthened his hand, they call a private meeting away from the table where they can talk about jobs and money, energy and well, other stuff.

Enviroplayer is, of course out of his depth. He barely has the money for such a high-stakes game. Minister Shabangu, Shell, Uncle Jacob and the Corporatocrat all want him gone. But like a tick he clings to their soft, corpulent underbellies.

So, as for gambling, TKAG is an unwilling participant. The very word, gamble, implies that if the gambler wins, there is some reward. But for TKAG, there is no reward. No money. No riches. Just the knowledge that years of unfunded, unpaid work has been expended to protect something for unborn Africans.

Nobody, of course asked TKAG to take up the cudgels. The other environmentalists to whom David refers, whilst deploring the idea of fracking, may in fact receive much of their salary, car allowances, fancy office rents and Christmas bonuses, from some of the very Corporatocrats who want fracking to go ahead. Little wonder they are too scared to take a seat at the table.

TKAG, far from ‘gambling’ on emotion and supposition actually base their position on the research of scientists[3] who have taken no money from the Corporatocrat’s, and on the research[4]of credible government departments. TKAG has been to the US for 5 weeks, to meet these scientists in their homeland and taken time to observe and record the scope and scale of real fracking operations. TKAG’s stance is not based on supposition or emotion and is not a gamble.

One of Uncle Jacob’s senior card carriers, though, may well be part of the state-funded gamble. Minister Peter’s, at the time, head of Energy for South Africa, visited America[5] to investigate fracking. The Minister’s report-back subsequent to the remarkable 4-day journey, informed South African media that she had not ‘witnessed anything that turned her off the extraction process’. The arduous trip evidently so confused the Minister that she couldn’t remember which small town she had visited “on the coast”, but she did remember that the whole operation was run by a woman. So detailed was the Minister’s briefing to her staff that one of her sidekicks reported to the press that the town was Marcellus. Go figure. During the whirlwind tour to investigate fracking, Peters was the guest of the state government but also met industry representatives, including Shell and participated in the Group of Friends on Sustainable Energy for All discussion at the UN as well as attending the Bloomberg New Energy Finance 2013 Summit in New York City.

Now David, this is the story of how a senior Cabinet Minister who advises Uncle Jacob investigates fracking for South Africa. All this in 4 days and a fracking investigation too? Just who is gambling here?

With reference to a SEA for South Africa, we have long called for such a move. And it was in November in KZN that the Department of Water and Environmental Affairs announced the formation of just such a forum. TKAG was formally invited to participate in the SEA, which included international scientists. The unfortunate passing of Mr. Mandela resulted in the cancellation of the event, which we expect to be re-scheduled for early 2014. So in fact, TKAG has committed to being involved and playing a constructive role. Far from a gamble.

An overarching investigation of all of the elements of a SEA, as described in my last piece, would, according to the academics that have been approached by TKAG, cost between R7 and R10 million. Little more than 50% of the R16 million rand that has been allocated to the Eastern Cape government to prepare that province for fracking. In the absence of a national approach to this scientific debate, does that not constitute a gamble? And how is TKAG (as the poorest and weakest player at the table) expected to fix it?

Meanwhile, Shell, with the hundreds of millions of rands in their publicly touted budget, have commissioned and released two reports – one from Markinor, which proclaimed that 75% of South African’s were in favour of shale gas exploration (really?); and another – the infamous Econometrix report that talks of jobs and riches on an unimaginable scale. Interestingly, neither the companies nor Shell were prepared to reveal the background instructions, notes, findings and questions on which these reports were based. In contrast, and using donations from private people (R50 at time), Afriforum, Wilderness Foundation, and our own money, TKAG commissioned a R100 000 review of the Econometrix report by an expert South African team[6]. Moreover, TKAG stipulated to the team, at the outset that the report would be made publicly available, even if it weighed against our position.

Lastly, we have offered, and do so again now, to make available all of the correspondence, notes and instructions that passed between TKAG and the authors. To add scientific substance to an unfair and unscientific gamble, TKAG went so far as to submit the report for peer review. It was submitted to three respected scientists, one in SA and two in the US, and received favourable review from all three. The Econometrix document provides no such benchmarks. A gamble perhaps?

It is submitted to you that a reading of this report (which deals with the economics only) may provide an inkling of the effort to which we have gone, without formal standing, and on a literal shoestring compared to Shell and Uncle Jacob, to inject a measure of honest science into a very crooked deck.

In closing, I must refer to another player who joins and leaves the game randomly. This is the typical freelance journalist, who spotting a hot topic realises the value of joining. Let’s call him Opportunista. Reliant on publicity, he quickly hops aboard a national media platform. And so, conveniently being uninvolved in big business, government, tourism, farming or even environmentalism, he is able to altruistically dive into the game, ostensibly there to protect the interests of a passive, fickle and self-indulged public. Trumpeting his caveat of ‘trust no one’, he cautions his followers to eschew support for government, the oil companies or the environmentalists. Focus only on the gas bonanza, and a gas driven GDP surge that will solve the county’s energy, jobs and revenue problems, he urges. Opportunista can leave the game at any time, knowing that no one can point at him – he after all only highlighted the folly of not grabbing the bonanza – not how it should be accomplished. As for gambling, well he has nothing to lose and only fame to gain.

David, apart from one instance of being required, to choose between being obtuse or dishonest, I have thoroughly enjoyed the opportunity to debate this issue with you. My eagerness to read your response is overshadowed only by the possibility of a live (and unprepared) debate.

3 responses

  1. Thank you for continuing the debate, Jonathan. Here’s my response:

    Jonathan Deal does it again!

    Jonathan, in his previous article, again completely ignored the case I have put forward since this debate began. Initially I thought there was little point in repeating my argument once more, until I read comments on social media sites. Some readers aligned to TKAG’s view complimented Jonathan on his “rebuttal”. But a rebuttal would require Jonathan to actually address the main pillar of my original article, not merely say why he doesn’t like fracking, which is all he does. I will therefore restate my position in writing, for the fourth and final time.

    The most effective approach to limiting the negative environmental effects of energy development is based on a scientific analysis of all generation options and their effects. This offers us an objective basis to debate, on environmental grounds, which kinds of energy should be preferred overall or in a particular area.

    TKAG are uninterested in discussing the environmental impacts of alternatives to shale gas. Their position seems to be that as long as the Karoo is saved it doesn’t matter how electricity is generated or which land is degraded elsewhere in the process. Jonathan never addresses this environmental concern in his replies.

    Jonathan makes a number of points which relate to fracking in general, but are completely extraneous to the issue in the articles he purports to respond to. Jonathan’s tactic of responding with only superficially relevant arguments is so well developed he should seriously consider entering politics, he’d be good at it. Here’s my response in a nutshell:

    Corruption

    One of Jonathan’s often used anti-fracking arguments has been the risk of corrupt practices in the shale gas industry.

    Transparency International’s “Corruption Perceptions Index 2013” rates 177 countries and territories from least to most corrupt. South Africa, at position 72, is one place below Italy, a country where mafia involvement in renewable energy has been widely reported for many years.

    Last year about a third of Sicily’s 30 wind farms, in addition to several solar power plants, were seized by Italian authorities. Politicians and businessmen, “tenderpreneurs” in South African terms, were among those arrested for renewable energy linked corruption. One reason the mafia focussed on the renewable energy sector was the sector’s generous subsidies. In fact, it is arguable that subsidised industries, like renewables, are particularly susceptible to corruption.

    It is foolish, at least, to think renewable energy, or any industry, is exempt from the danger of corruption. More importantly, corruption is an entirely irrelevant consideration when establishing which form of energy would be the least environmentally harmful. Corruptly owned mafia wind farms are financially as filthy as coal, but the energy they produce is as environmentally clean as that of wind farms financed by legitimate means.

    Government competence

    Drawing attention to examples of ministerial error could become South Africa’s national sport. Of course Jonathan can point to examples related to fracking; we could all do the same in just about any field regulated or financed by government. Nevertheless, even the most inept Minister of Energy will not miraculously morph into a model of efficiency and saintly honesty if fracking disappeared from the equation, leaving a choice between renewables or coal. Does Jonathan honestly believe these same ministers speak learnedly and authoritatively on means of generating energy besides shale gas?

    When Jonathan refers to incapable politicians, it reminds me of those same politicians kissing babies or handing out food parcels. It’s a direct appeal to our emotions, regardless of the topic at hand. The fact that incapable politicians hold ministerial positions is no more relevant to which form of energy is the least environmentally damaging than it is to whether permitting lion hunts aids or harms conservation or whether our fish stocks require more conservative commercial line fishing rights.

    Employment

    Perhaps the greatest environmental benefit of wind and solar energy is that, after the infrastructure has entered service, it can be pretty much left to do its thing. There is no need for a continuous supply of fossil fuels. There is no need for thousands of miners to dig up those fossil fuels either.

    Jonathan has drawn attention to shale gas proponents’ dubious employment statistics. He has a point. But it is an irrelevant one. No matter what the truth of those statistics, it is a safe guess that during their operational phases, substantially more employees will be needed to generate the same quantity of power at a coal-fired power station than at a solar plant.

    Saving jobs is not an argument for environmentalists to rely on in this debate. Coal could be one of the better choices, if your prime concern is maximising employment, but not if your prime concern is lowering carbon emissions.

    Economics

    Jonathan refers to the part TKAG funded review of Econometrix’s “Special Report on Economic Considerations Surrounding Potential Shale Gas Resources”. From what Jonathan has said, it appears that the review of the Econometrix report is the only study in which TKAG has financially invested.

    Unsurprisingly, as the Econometrix’s name suggests, the initial report and TKAG’s response to it do not look at the environmental impacts of our energy choices, but at the economic case for fracking. The strength of the economic case for shale gas is immaterial to the relative environmental impacts of extracting that gas.

    Moving forwards

    Jonathan has suggested we hold a public debate. I will be back in Cape Town in late March and I am hopeful that a debate in person rather than online might mean I can focus the debate on what really matters – the environmental impacts of all our potential energy choices. Anyone concerned about the environment in the Karoo as well as other places needs a markedly more mature response than the narrow nimby anti-fracking case of TKAG.

    So I will accept the invitation, and will let you know when debate practicalities are settled.

    Sources

    1. “Sting operations reveal Mafia involvement in renewable energy” Washington Post, 23 January 23 2013.

    2. “Italy makes ‘Mafia’ arrests over Sicily wind farms” BBC Online, 15 February 2013.

    3. “Analysis – Is the Italian mafia turning green?” Wind Power Monthly, 17 April 2013.

    4. “German homes, offices searched in mafia wind farm probe” Reuters, 19 November 2013.

    5. “Corruption Hit as Italy Cleans Up Wind Sector” Renewable Energy World, 10 June 2013.

    6. Corruption Perceptions Index 2013, Transparency International.

  2. Pingback: Fracking confusion is the order of the day for David Johnson « Jonathan deal

%d bloggers like this: