Yesterday, the Minister of Mineral Resources published two notices with significant impacts on the petroleum industry.

The first notice (notice 71 of 2014) provides that the existing moratorium on applications for reconnaissance permits, technical co operation permits, exploration rights and production rights relating to shale gas in the Karoo region has been extended. However the existing applications, received and accepted before 1 February 2011, are excluded from the moratorium. The notice provides that if, in the interim, the existing applications are granted, the applicants will not be entitled to conduct hydraulic fracturing until the technical regulations, a draft of which was published for comment in Notice 1032 of 2013, have been promulgated. This seems to suggest that these licences are likely to be granted soon, prior to the finalisation of the technical regulations.

The second notice (notice 72 of 2014) states the Minister's intention to declare a moratorium on all new, onshore and offshore, applications for reconnaissance permits, technical co-operation permits, exploration rights and production rights for a period of two years and invites relevant stakeholders to comment on this proposal within 30 days from the date of publication.

The relevant notices are attached for your information.

Kind regards,

Lizel Oberholzer

Director