The Mining Minister Ngoako Ramatlhodi had said on Monday 16 March, 2015 that he expected to start issuing shale exploration licences later this year. Ngoako Ramatlhodi told Reuters: “At the moment we are going through the consultation process (with stakeholders such as communities),” and that “We should finish the consultations by the middle of this year and that will enable us to issue licences.”
The Royal Dutch Shell is pulling back from its shale projects in South Africa due to lower energy prices although it is still seeking an exploration licence for the onshore Karoo basin, its country manager said on Monday. Crude oil prices since have more than halved since June of 2013 and has put high cost projects such as shale gas exploration in jeopardy around the globe, Shell South Africa chairperson Bonang Mohale told Johannesburg station Talk Radio 702. Mohale said: “The reason to go to a low cost holding position is as a result of a difficult period for world (prices).”
Shell’s retreat is a blow to the South African government, which has been criticised by oil firms for delaying issuing exploration licences, most notably in the Karoo, which is believed to hold up to 390 trillion cubic feet of recoverable reserves. Shell has been waiting for six years for an exploration licence.
However green groups and landowners in the Karoo have argued that exploring for shale by fracking, or hydraulic fracturing, would cause huge environmental damage.