South African court revokes Shell offshore permit

A high court in South Africa today revoked Shell's right to explore for oil and gas along the country's Wild Coast on the basis that the permit was granted unlawfully.

The Makhanda High Court ruled that a decision by the Department of Mineral Resources and Energy (DMRE) to grant Shell exploration rights for the offshore Transkei and Algoa blocks should be set aside. The judgment marks a major win for environmental activists and coastal communities, as well as small-scale fishing and tourism industries along South Africa's eastern coast. They argued that there was a real threat that exploration in the area would irreparably harm marine life and negatively impact the livelihood of small-scale fishers.

The ruling sets an important precedent for other offshore oil and gas projects in South Africa, given that legal battles and local opposition have delayed several exploration efforts. Earlier this year, a court in Cape Town ordered an interim ban on Australian firm Searcher's seismic survey across a number of Orange Basin oil and gas concessions along South Africa's west and southwest coasts. Most of the Orange Basin is located offshore South Africa and two large oil discoveries made by TotalEnergies and Shell offshore neighbouring Namibia earlier this year indicate that it could hold huge reserves.

The Makhanda court found that public consultation on the Transkei and Algoa blocks was inadequate. "Meaningful consultations consist not in the ticking of a checklist, but in engaging in a genuine, substantive two-way process aimed at achieving, as far as possible, consensus," the judge said. The court found that an apparent dispute between expert evidence on the harms of seismic testing to marine life should have led the DMRE to adopt a precautionary approach. "This applies particularly when there is uncertainty that requires risk-aversion and caution to be taken," it said.

The judge also acknowledged the ocean's key role in the livelihoods of coastal communities. "The applicant communities contend they bear duties relating to the sea and it is incumbent on them to protect the natural resources for present and future generations." Had the DMRE taken the issues of climate change and the right to food into account, it may have found that exploration in the blocks was "neither needed nor desirable", the judge ruled.

The court found that the energy minister Gwede Mantashe was duty-bound to consider the Integrated Coastal Management Act, which "introduces an integrated approach to management". Instead, "the decision-maker did quite the opposite and dealt with the application as an energy-sector specific issue".

Shell promised jobs and increased government revenue, but these claims were not supported by evidence, the judge said, adding that the firm did not explain how jobs would be created "or how the seismic survey would improve most South Africans' socio-economic circumstances". The judge ordered Shell and Gwede Mantashe to pay the applicants' costs.

Seismic ruling

Today's ruling follows a court order last year that forced Shell and its partner Impact Africa to suspend their planned seismic survey following widespread public opposition and nationwide protests. The nearly five months-long seismic survey was to be undertaken in a 6,000km² area and would have consisted of a research vessel firing air guns every 10 seconds.

The application was brought on behalf of non-profit organisation Sustaining the Wild Coast and several fishing communities by the Legal Resources Centre and Richard Spoor Attorneys. Natural Justice and Greenpeace Africa subsequently joined the court case.

By Elaine Mills