https://www.polity.org.za
Deepening Democracy through Access to Information
Home / Opinion / Real Economy RSS ← Back
Close

Email this article

separate emails by commas, maximum limit of 4 addresses

Sponsored by

Close

Embed Video

1

Complex debate

Complex debate

28th February 2014

By: Terence Creamer
Creamer Media Editor

SAVE THIS ARTICLE      EMAIL THIS ARTICLE

Font size: -+

There is no question that the issue of shale energy has emerged as a major topic of discussion for government, economic and energy leaders. It was, therefore, interesting to be offered a perspective into the role that unconventional oil and gas could play in future from an individual who keeps a watching brief on all energy developments internationally.

Speaking at the global release in Johannesburg last week of the World Energy Council’s (WEC’s) latest ‘World Energy Issues Monitor’, WEC secretary-general Christoph Frei noted that unconventional oil and gas were top-of-mind considerations for global leaders, all of whom had been monitoring their impact on the energy and economic landscape of the US – the world’s shale-energy leader by a country mile.

Advertisement

This view was supported by the WEC’s survey of 800 energy leaders in 84 countries, which found that so-called ‘unconventionals’ had risen as an action priority, with strong interest emerging outside North America, including in countries such as Argentina, Algeria, Poland, Ukraine and China.

The South Africans surveyed, by contrast, ranked unconventionals as being associated with high levels of uncertainty, owing to a lack of clarity over the size of the shale resource and the rules surrounding its possible exploitation. Sentiments that probably would not have changed much even if the survey had been conducted after President Jacob Zuma’s recent State of the Nation address, during which he expressed support for shale-gas mining and promised progress on the final regulations and the granting of licences.

Advertisement

It is estimated that the country could have as much as 485-trillion cubic feet of shale gas, ranking the country as a possible top-ten resource holder. But Frei stressed that it was “one thing to say there is a theoretical, or technical, resource, but another to actually confirm that this is an economic resource”. It was, thus, still necessary, in his view, to ascertain whether or not the reserves existed and could be extracted using the hydraulic-fracturing technique.

He also said that South Africa would have to weigh a number of complex factors when assessing how best to proceed in exploiting its shale-gas resources, with water management presenting the most significant risk. “How one deals with water is also going to be very important,” he added. But he also argued that there had been relatively few water-management issues in the US, where tens of thousands of wells had been drilled.

Nevertheless, in the context of water scarcity, South Africa would need to be “careful” and would require a “solid framework” within which to manage the water-energy nexus.

On the positive side, the mining of the Karoo resource could lower South Africa’s dependence on coal, reduce carbon emissions, stimulate economic growth and raise competitiveness.

Frei pointed out that gas was expensive to transport and, therefore, argued that unconventional gas was, by default, a resource that should be used locally, or possibly regionally. By consuming its unconventional energy domestically, the US had improved its competitiveness and “the same will have to be considered in the South African context”.

But the WEC also did not expect many other countries to “replicate the US success at the same speed and price for a number of reasons, including geological, the availability of equipment, logistical, legal, financial, as well as those related to the water nexus”.

EMAIL THIS ARTICLE      SAVE THIS ARTICLE

To subscribe email subscriptions@creamermedia.co.za or click here
To advertise email advertising@creamermedia.co.za or click here

Comment Guidelines

About

Polity.org.za is a product of Creamer Media.
www.creamermedia.co.za

Other Creamer Media Products include:
Engineering News
Mining Weekly
Research Channel Africa

Read more

Subscriptions

We offer a variety of subscriptions to our Magazine, Website, PDF Reports and our photo library.

Subscriptions are available via the Creamer Media Store.

View store

Advertise

Advertising on Polity.org.za is an effective way to build and consolidate a company's profile among clients and prospective clients. Email advertising@creamermedia.co.za

View options
Free daily email newsletter Register Now