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Shell’s Court Battle Over South Africa Energy Exploration Delayed -Environmentalists

Shell’s Court Battle Over South Africa Energy Exploration Delayed -Environmentalists

A court case over whether to allow Shell (SHEL.L) to explore for oil and gas off South Africa’s pristine Wild Coast has been delayed until next year, a lawyer for environmentalists said on Wednesday.

Shell wants to overturn a decision by the Makanda High Court last September that prevented it from exploring in the environmentally sensitive area.

Exploration on the Wild Coast had been approved by the country’s then-energy minister in 2014.

“It doesn’t seem like it (hearing) will be this year and will likely be heard in the first term of 2024 only,” Ricky Stone, a lawyer for environmental lobby groups Greenpeace Africa and Natural Justice, said.

Environmentalists and coastal communities have protested against Shell’s plans for seismic surveys, saying its underwater acoustics are harmful to marine animals, especially migrating whales. Fishing and other practices will also suffer, activists have argued.

Exploration interest in South Africa, sandwiched between petroleum hotspots Namibia and Mozambique, has risen following TotalEnergies’ (TTEF.PA) discovery of the first of two large gas fields off the country’s east coast in 2019.

The September ruling by the High Court nullified the decision that in 2014 had granted Impact Africa, a local unit of privately held Impact Oil and Gas, exploration rights in the offshore Transkei and Algoa areas on the east coast, as well as subsequent decisions taken in 2017 and 2021 renewing those rights.

Shell is the operator in the two Transkei and Algoa blocks and holds a 50% stake with Impact holding the other half.

“It is a massive case and much of what happens in the rest of the sector depends on the outcome of this case,” Stone said.

In court papers before the Supreme Court of Appeal seen by Reuters, both the energy minister and Shell contend that the High Court erred in several aspects, including by allowing the review application to be lodged beyond a 180-day time limit.

“The Makanda judgment will dampen investor appetite if left unchallenged,” Megan Rodgers and Tim Baker, lawyers for Impact Oil and Gas, told Reuters.


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