The South African Civil Society Information Service
A nonprofit news agency promoting social justice. Seeking answers to the question:
How do we make democracy work for the poor?
A nonprofit news agency promoting social justice. Seeking answers to the question:
How do we make democracy work for the poor?
By Glenn Ashton · 18 Oct 2012
South Africa may contain the world’s fifth largest reserves of shale gas. Yet there remain critical questions that have neither been raised nor addressed regarding the exploitation of this and other regional gas reserves. The fact is that the full implications of this potentially game-changing proportion of energy supply have not yet been properly examined or analysed. We need to carefully consider how to integrate them into our national and regional energy mix.
The Karoo could contain as much as 485 trillion cubic feet (Tcf) of shale gas. This is termed unconventional gas, as it requires unconventional extraction methods, namely fracking, or fracturing of the rock matrix in which it is trapped to exploit the resource.
While quantities remain unconfirmed, recent permission to grant exploration licences will improve our knowledge of available volumes. It may only be possible to exploit a small proportion of the total amount, with estimates of around 35 Tcf being bandied about.
Just how much is 35 Tcf or 485 Tcf of gas anyway? A useful benchmark to bear in mind is that PetroSA’s Mossgas gas-to-liquid refinery was constructed on the strength of a confirmed gas resource of only around 1 Tcf. This refinery supplies upwards of 6% of our national liquid fuel requirement.
Neighbouring Mozambique has a confirmed gas reserve of at least 130 Tcf. Tanzania has an estimated 45 Tcf, Angola around 12 Tcf, Namibia at least 5 Tcf. These figures highlight just how much proven conventional gas reserve is available within our immediate geographical neighbourhood.
These quantities exclude further estimated reserves of around 22 Tcf off our own West coast and 9 Tcf along the South coast. There is also around 5 Tcf of coalbed methane gas. These figures indicate that the Karoo shale gas may not even need to be exploited in the short to medium term, unless we adopt a policy of, “Frack it all; lets sell out to China and India!”
It is an ugly reality that such potentially significant energy resources provide their own momentum, propelled by national economic priorities, fostered by commercial interests like Shell. Once released it is supremely difficult to force this particular genie back into its lamp.
The fact is that the huge amounts of conventional gas present in our geological – and geo-political - neighbourhood provide a game-changing amount of conventional hydrocarbon fuel supply for South Africa and the region. Because South Africa has always had, and consequently relies on its abundant coal reserves for energy generation, gas has never really featured as much more than a footnote in our projected energy mix.
The most recent Integrated Energy Plan mentions gas as a potential source of energy but not much more; coal remains the preferred primary energy source. The Integrated Resource Plan for Electricity reiterates coal as king but mentions that our gas infrastructure is absent, limiting the short-term potential. However it notes that gas could potentially supply 15% of the total energy mix. Similarly the National Infrastructure Plan mentions West coast gas but fails to provide detailed forward planning scenarios.
There is yet another elephant in the room. It is this: Why has nobody questioned who drafted and controlled input to the investigative report on fracking? Remember it is this report that led our Minister of Mineral Resources, Susan Shabangu, to advise cabinet to permit exploration of the Karoo.
Whilst there were some independent experts, the chair of researchers compiling this report was the CEO of PetroSA, the State owned oil company, assisted by his compiler and contributing author, the technical compliance officer of PetroSA. A further three of ten contributing authors are also intimately associated with PetroSA; others fall under the aegis of PetroSA’s holding company, The Central Energy Fund (CEF), most notably the head of the CEF’s gas division, iGas.
While some - and no doubt the state itself – may choose to defend this corporate incestuousness by arguing that it had to involve the best informed people to compile such an analysis, is this correct? Was there sufficient independence to found a cabinet decision to permit exploration of a resource on the advice of officers of a state-owned fuel company which stands to gain directly from the exploitation of this resource? PetroSA stands to claim around 20% of all gas revenues extracted, as well as ensure the longevity of its Mossgas refinery. Why has there been no outcry?
Equally what about statements made by the Minister of Energy, prior to the release of this report, where she said, “It would be wrong for us to not use the resources that God left us with. This is a blessing that God gives us, and we need to exploit for the benefit of the people?" Could a counter not be made that the Karoo may be a blessing from God which ought to be protected? Or is God perhaps a modern mammon?
The state may have actually shot itself in the foot, because it appears relatively easy to legally challenge the objectivity and independence of parties that supported and made the decision to allow further gas exploration in the Karoo. The relationships between cabinet, the CEF and PetroSA certainly appear insufficiently transparent to engender either legal or public trust. Only a naïf would claim otherwise.
It may be preferable for a state run energy company to make these decisions instead of private corporations but that is a self interested perspective that fails to engage the arcane political complexities of the CEF. Taking all of these issues into consideration – the biased fracking investigation, the huge regional supplies of gas and the lack of any sort of integrated forward planning – some significant credibility gaps emerge.
An inordinate amount of effort has been wasted in debating fracking the Karoo. What ought to happen is the formal development of a policy that integrates our conventional gas reserves firmly into the national energy mix. Such a policy ought to consider using gas as a transitional fuel as part of a fundamental shift toward a lower carbon economy. And Karoo shale gas need not even be considered as part of the mix, at least initially.
Gas is an ideal transition fuel as it emits less than half the amount of CO2 as coal, for the same amount of energy produced. While gas is not nearly as green as claimed by its supporters it is a significant improvement on coal which creates particulate, mercury, ash, sulphur dioxide, radio-nucleotide and other foul emissions.
Exploiting our conventional gas reserves would enable us to shift from our profoundly problematic reliance on coal, which is proposed to be retained until at least 2035, and probably until 2050, under existing planning scenarios. This places us amongst the dirtiest energy producers per unit of GDP in the world.
A shift to gas as a source for co-generation of electrical energy could initiate the expansion of a significant gas infrastructure, transferring us toward a more sustainable energy policy. Instead of the proposed 15% of gas generated power by 2035, we could quadruple this and move to 60% gas base-load power, with the balance from mixed renewables. Coal and expensive nuclear power can be phased out. As renewable base-load sources such as ocean current generation mature, we can cast aside fossil fuels entirely in favour of a full reliance on base-load renewable sources.
A major problem is that Eskom and vested interests remain fixated on coal. This is reinforced by the corporate political nexus with increasing numbers of political heavyweights becoming directly or indirectly involved in coal extraction.
South Africa can retain its role as the regional economic powerhouse by furthering rapprochement between ourselves and our gas rich neighbours. This would initiate a shift toward cleaner energy, ongoing regional energy integration and increased job creation. The benefits are broad and significant: There is no reason we cannot follow the Norwegian or Alaskan models where energy resources provide tangible local benefits. God forbid we follow the Angolan model.
South Africa cannot remain side-tracked and fixated on dirty coal and unproven Karoo shale gas, with all of their related risks and impacts. Only after we have developed a mature regional gas infrastructure based on conventional gas resources should be begin to consider tapping into our unconventional Karoo resources. By that time fracking methods may have matured sufficiently. Until then, why risk it?
This is the core of the issue. If we continue to treat our energy resources as simply a means of enrichment, of economic advancement, of exploitation of natural resources because we can, we are condemned to continue on down the destructive road of dirty, damaging energy generation. We would become yet another set of passive victims of the resource curse.
On the other hand if we hold the bigger perspective and view our coal, shale gas and all of our other energy resources for what they really are; precious resources, which only increase in value over time as cleaner ways are found to use them. Only by making this realisation will we be able to begin our transition toward sustainable energy generation, founded on a truly new energy policy and programme.
Or we could blindly continue to remain in thrall to Shell, Eskom, the ideologues of the CEF and a few selected BEE fatcats, and pursue business as usual.
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