Oct 29 2014 Author: James Perkins
Progress is being made towards opening the Karoo region of South Africa for initial explorations for shale gas reserves. The Petroleum Agency of South Africa (PASA) announced that it was now processing outstanding proposals from 2010 to begin shale extractions, although it is not processing applications that were received after 1st February 2011.
Shell, Challenger Energy’s Bundu Oil and Gas exploration and Falcon Gas and Oil all have pending applications. Robert Willes, chief executive of Challenger Energy said that the first step for government approval was a review of the applicants’ “Environmental Management Program” which was included in the original 2010 proposals.
The deadline for this is 27th February 2015. Once those regulations are met initial test sites are to identified and established to determine the quality of the shale resource available and decide the best locations for permanent extraction sites.
The scale of the shale resource in the Karoo region is unclear. PASA suggests that estimates range from 30 trillion cubic feet to 500 trillion cubic feet. Uncertainty of the exact quantity of shale in the region was voiced by Niall Kramer, Shell’s upstream manager, in March of this year. He asserted that there was no guarantee of economic success from extraction in Karoo and that detailed exploration was the first step before any long term plans are set.
New applications and those submitted after the 1st February 2011 cut-off will not be considered without a change in policy from South Africa’s mineral resources minister Ngoako Ramatlhodi and there is no “indication at this stage as to when this might happen,” according to PASA’s legal and compliance officer Michael Thovhakale.
