Cape Town - Royal Dutch Shell said on Thursday it hoped to invest $200m (about R1.4bn) to
explore for shale gas in the Karoo - plans facing
tough opposition from farmers and greens worried about the environmental impact.
Ecological concerns led the government to place
a moratorium on oil and gas exploration licences in the region, where
the controversial shale extraction technique of hydraulic fracturing or "fracking" might be deployed.
“If exploration efforts prove that shale contains commercially
producible gas volumes, then South Africa could see production from this source
within a decade,” Jan Willem Eggink, general manager upstream ventures for
Shell’s South African unit, told a news conference.
Petrochemical group Sasol, Anglo American and Falcon Oil and Gas
are among those eyeing shale gas in the region, with Shell leading the pack with
exploration rights pending to 90 000km².
Farmers and conservationists are worried about the possible impact
of fracking, in which drillers blast millions of
litres of water, sand and chemicals at high pressure into underground rock to
create cracks for the gas and oil to escape.
The sparsely-populated Karoo is renowned for its rugged
scenery and is home to rare species such as the mountain zebra and riverine
rabbit, putting it high on the radar screen of conservationists.
Those in favour of fracking in the Karoo say the discovery of gas
would help South Africa plug a chronic power shortage and reduce dependence on
harmful coal-fired power stations. About 90% of the nation’s electricity
is supplied by coal.
“By drawing on potential abundant domestic gas supplies, you can
meet rising energy demand while maintaining energy security,” Eggink said.
He said he believed South Africa could well have at least half of
an estimated 13.73 trillion m³ of trapped shale gas, enough to be
commercially viable and allow the country to become energy self-sufficient for
decades to come.
Eggink said the company would not compete with farmers for scarce
water resources and would likely truck in water initially before trying to pipe
it by using the brackish water found deep underground.
Eggink said Shell would also consider paying landowners for access
to their land, although no compensation policy has been finalised yet.