At least 150 people attended the Seminar at Cedara College this week. Students, farmers, environmentalists, conservancies, health professionals, geologists, media and businessmen were all delighted that they had made the effort as it was extremely informative. Pam Haynes commented “It was pitched at the right level. The presentations were all excellent and, although complicated, were graphically well illustrated and one had time to absorb the information. The pace of the presentations was good and the presenters really knew their stuff.”
Organiser, Sue Viljoen of WWF-SA welcomed everyone and introduced Francois du Toit who provided an overview of all the current activity around Unconventional Gas (which includes Coal Bed Methane CBM) and the companies that hold the permits: Karoo: Shell, Bundu and Falcon; Soutpansberg CBM – Tshipisi, Umbono, Iningi; Waterberg CBM – Anglo Group; Springbok Flats CBM – Umbono and Badimo; Ermelo CBM – Kinetiko and Badimo; Eskom Majuba (Amersfoort) UGC; Free State Helium – Anglo; Wits Basin Biogenic Gas – Molopo E&P; KZN 3.5M ha – Rhino Oil & Gas; Matatiele – Rhino Oil & Gas; Free State, Mpumalanga, Gauteng – Rhino Oil & Gas; uKhahlamba Drakensberg buffer – Sungu Sungu and Motoane, Badimo, Molopo E&P, Kinetiko
Other names to look out for: Riverwalk, Bundu Gas, Umbono, Tshipisi Energy, Extrispex , Alumni Trading, Aberdeen, Ininigi Investments, Moonstone Investments, Booi Brothers, Umbono, Cairn Energy, White River Exploration, Motuoane Energy, Bertofon.
Clearly the Great Gas Grab is in full swing! “It is relentless,” said Francois, “we have to ensure that there is a moratorium placed on all exploration until a full Strategic Environmental Assessment has been completed, as they have done in the Karoo.” Download Francois’ presentation here.
Head of the WWF-SA Policy & Futures Unit, Saliem Fakir’s presentation entitled Frackenomics was fascinating. He told us that exploration companies tend to overplay the economics and that outside of the USA (eg in China and Argentina) drillers are finding it very difficult to make Unconventional Gas commercially viable. In South Africa the price would be regulated and the Government wants a 20% royalty.
Unlike Conventional Gas production where a single well taps into a underground reservoir of gas, Unconventional Gas (including Coal Bed Methane and Shale Gas Production), is difficult to extract and requires many, many wells across large landscapes. As it is impossible to see into the underground rock formations and determine the amount of gas present, only about 10% of the wells drilled might produce gas and each well costs between 11 and 20 million USD (over R300 million) to build. Most of the gas is extracted within 18-24 months. Operations are run by a handful of very highly skilled engineers. “Operating costs are high – equipment has to be imported and specialists are needed to operate them. Although America has made fracking work, South Africa might only be able to cope in 20 to 30 years when technology improves and there is a viable gas market in this country.” This is an expensive business. Download Saliem’s presentation here.
A geologist in the audience, Digby Gold, pointed out that there would be severe challenges in KZN as there was little Ecca Shale and massive dolerite deposits. He is really concerned for the area adjacent to the uKhahlamba Drakensberg, however.
Tjasa Bole-Rentel, Senior Energy Researcher with WWF-SA Policy & Futures Unit, dealt with the water related risks, something that is forefront in our minds, particularly during the current drought. She believes that the greatest environmental and health risks are increased seismicity and storage of waste water. Download Tjasa’s presentation here.
The sheer volume of water required for the technology for hydraulic fracturing or other shale gas extraction methods means that severe pressure will be applied to secure cost-effective water sources from surface or ground water in already full subscribed areas or alternatively deep aquifer brine water or sea water would be used with huge accompanying risks to farmland and river systems.
Chemical spills, waste water treatment and disposal of the huge volumes of flow back and produced water from multiple wellheads in densely well populated fields, were some of the issues that increased cost of production, the potential for water contamination and human and animal health risks. As technology improves, the mining companies are increasingly able to reuse their own waste water for production, but the possibility of human error is significant should the water be moved to storage or treatment facilities. Over 1000 chemicals are used in the fracking mixture. While the chemicals are only a tiny percentage of the liquid, they can have a big impact. A Review by Colborn in 2011 of all the possible chemicals used found that 75 % affect the skin and eyes, 405 affect the brain, 37% affect the endocrine system and 25% are carcinogens!
Wells are drilled vertically up to depths of 2 or 3 kilometres and then horizontally underground in all directions. The lack of baseline information on water quality coupled with a significant time lapse after extraction activities for potential water quality impacts to occur, amongst other factors, means that it will be close to impossible for a landowner to prove that gas extraction and associated activities is the source of contamination of boreholes, aquifers or water sources.
Namisha Muthraparsad, Acting Deputy Director, Energy Sub –directorate Compliance Monitoring Chief Directorate, National Department of Water and Sanitation (DWS), pointed out that her Department was neither for nor against Unconventional Gas and explained the legislation and regulations that are in place to prevent destruction of our water resources. DWS has declared Shale Gas, Coal Bed Methane and Underground Gasification controlled activities – the only Government Department to have done so. Clearly, she and her colleagues have done a vast amount of research in the short space of time since the issue of Unconventional Gas appeared and are well armed with knowledge to ensure the protection of South Africa’s water resources.
With the dwindling supply of clean surface water, it was imperative to protect underground water resources from further contamination. Mini-explosions deep underground could lead to the release of saline water (also known as old water), which could contain radioactive minerals, and then contaminate fresh water. Her department is already struggling with the legacy of underground water pollution from other mining industries.
She explained clearly that mining companies would have to apply for a Water Users Licence and that that could only be issued once all other needs were met. “South Africa is the 30th driest country in the world. 8% of the land surface supplies 50% of the water we use. These are our Water Towers which have been declared National Freshwater Ecosystem Priority Areas. A large part of KZN falls into this category.” Before water is allocated to industry, all social needs must be met. First, the Ecological Reserve of any river must be allocated (for the health of the river and the environment), then human needs are accommodated. Thirdly, Inter-basin transfers – our international obligations – must be fulfilled, and only then can water use licences can only be issued for industry.
While we were all really pleased to hear about the complex regulations safeguarding our water, Ntombifuthi Nzimande a student at UKZN, pointed out “Legislation is great on paper, but in reality it sucks.” Namisha acknowledged that DWS need to put a lot more effort into compliance monitoring.
Pandora Long commented “It would appear that the press and radio announcement that the Government will authorise oil and gas exploration rights in the next financial year may be a push from an overzealous and under informed Department of Mineral Resources. Certainly the public at the WWF-Frack Free SA Seminar appears to have the real facts about unconventional gas development in South Africa and its potential to undermine the economic, social and environmental stability of our country in both the short and long term. If South Africa is looking to build its game around a healthy economy, healthy people and a healthy environment it needs to look towards renewable energy as the true game changer. Oil and Gas is a no ball.”
Plenty of questions and discussion ensured that the seminar ran a few hours longer than expected. Afterwards everyone tucked into delicious, low carbon snacks produced by Solfood Vegetarian Catering and discussed their new knowledge animatedly.
Sue Viljoen was pleased with the morning’s proceedings, in particular Namisha’s contribution, “We had no idea of the extent to which DWS is investigating and researching unconventional gas related impacts and learning from places throughout the world. I feel very encouraged to know that your department is keeping such a careful watch on these issues and keeping abreast of technological developments in this space.”