Sep 03, 2013
Fracking to require water use licence – MolewaBack
Pretoria|Africa|Bundu Gas & Oil|Chesapeake|Environment|Exploration|Falcon Gas & Oil|Gas & Oil Exploration|Projects|Resources|Shell|Statoil|Water|Africa|South Africa|Chemicals|Energy|Gas Resources|Oil|Oil And Gas|Oil And Gas Exploration|Recoverable Shale Gas Resources|Service|Services|Shale Gas|Shale Gas Exploration|Shale Gas Exploration Licences|Unconventional Oil|Environmental|Edna Molewa|Infrastructure|Water|The National Water Policy Review|Fracturing
© Reuse this
The Minister gazetted for public comment a notice of intent to declare fracking a controlled activity in terms of the National Water Act (NWA) for public comment. The notice included the exploration for, and production of, onshore unconventional oil or gas resources and any activities incidental thereto, including, but not limited to, fracking.
“What this means is that fracking becomes a water use, thus requiring a water use licence. In this regard only matters regarding water resources will be of consideration when licences are issued, including, but not limited to, the possible impact of substances and chemicals on the ground water resource,” Molewa said at a media briefing in Pretoria.
She added that the Department of Water Affairs (DWA) already had some applications for water use licences for fracking but that it would wait for the regulatory process to unfold before it would deal with them.
In September last year, South Africa lifted a moratorium on shale gas exploration in the Karoo region, which potentially holds 390-trillion cubic feet of technically recoverable shale gas resources, but has not yet issued any exploration licences.
Cabinet recently indicated that it is likely to authorise shale gas exploration before next year’s general election and moved to assure environmental groups opposed to fracking that it would proceed with exploration in an environmentally and socially responsible manner.
International oil companies such Shell, Challenger Energy subsidiary Bundu Gas & Oil Exploration, Falcon Gas & Oil, Statoil and Chesapeake have applied for shale gas exploration licences.
Molewa further emphasised that protecting the environment and South Africa’s water resources was the department’s key priority.
“We will take every precaution to ensure that the possible impact of fracking on our water is carefully managed and minimised,” she added.
“The DWA would like to be objective, while protecting the country’s water resource and finding methods to further development. I want what is best for South Africa and in particular the water sector,” Molewa said.
The Minister further pointed out that an interdepartmental task team, of which the DWA was a part, had been established to deal with issues pertaining to unconventional oil and gas exploration and production.
The monitoring committee was tasked with reviewing the existing regulatory framework for fracking and to develop the necessary regulations and guidelines on the methodologies of fracking. It would also develop guidelines to ensure that negative impacts of exploration for possible production of shale gas resources was prevented, mitigated or managed.
At the moment, the committee is only focusing on exploration as a decision had not yet been made on whether South Africa would move into shale gas production.
Meanwhile, Molewa reported that Cabinet had approved the National Water Policy Review, which was gazetted for public comment on August 30.
The review, aimed at filling gaps in the water policy and facilitating necessary amendments, addressed 12 key policy positions, she said.
These included a multiple water-use approach in infrastructure planning; access to basic water supply that would in future only be provided to indigent households; and the application of the “use it or lose it principle”, through which any unused authorised water would be reallocated to a public trust managed by the Minister.
Further, water trading between authorised water users would be stopped and social and economic equity would be prioritised through the reallocation of the water.
The Minister stated that currently 98% of South Africa’s water resource was allocated, which left little for new projects and economic developments.
“We have to free up South Africa’s water supply,” she said, adding that the policy did not intend to take away water from any specific group to give to another.
Molewa added that economic regulation would be applied throughout the water value chain and to avoid any conflict of interest, water use tariffs would be determined yearly by the DWA, in consultation with National Treasury.
She pointed out that, among other major decisions taken, the NWA and the Water Services Act would be combined.
“This is because there have been a number of implementation challenges arising from the separate pieces of legislation,” Molewa said.
Challenges that had been identified included that the current legislation did not contain any mandate at the national level for the development of a strategy that covered the entire water value chain.
“Although the department is working on an infrastructure investment framework which covers both water supply and sanitation services as well as water resources infrastructure, this is not enabled by any legislation.
“Separate strategies for the management, development, control and protection of water resource and the provision of water supply and sanitation service results in inconsistency in the management of the entire water value chain,” Molewa said.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Other Mining News
Updated 2 hours 3 minutes ago Platinum-mining company Lonmin on Wednesday completed three transactions that take its black economic empowerment (BEE) shareholding to the 26% laid down by South African law. The London- and Johannesburg-listed company said the three transactions had been concluded...
Updated 3 hours ago A day after announcing that it had gained some control over illegal mining activities at its Tanzanian operations, Aim-listed Richland Resources has agreed to sell the embattled TanzaniteOne Mining Limited (TML) to Sky Associates for $5.1-million. The gemstone...
Updated 5 hours ago Uranium miner Paladin Energy has completed an accelerated institutional component of its A$144-million entitlement offer, raising about A$50-million, with more than 86% of entitlements taken up. The dual listed miner said on Wednesday that the new shares, which were...
Updated 20 minutes ago South Africa needs to develop a broadly shared understanding of the concept of national interest, which International Relations and Cooperation Minister Maite Nkoana-Mashabane says should not be too “narrow in scope and overly economic in its focus”. The Minister was...
Updated 27 minutes ago More national and provincial departments, including their entities have received clean audits for the 2013/14 financial year, Auditor-General Kimi Makwetu said on Wednesday. The Auditor-General said this when briefing the media on the audit outcomes for national and...
Updated 33 minutes ago Eskom has asked its staff to consider voluntary retrenchment packages, a spokesman confirmed on Wednesday. "We can confirm that we have announced the process by which employees can apply for voluntary separation packages," spokesman Andrew Etzinger said.
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
This Week's Magazine
JSE-listed real estate investment trust (REIT) Rebosis Property Fund achieved a distribution growth of 8.1% to 99.45c per linked unit in the financial year ended August 31, despite volatile market conditions.
A low-cost, inflatable incubator won this year’s international James Dyson design award, which aims to encourage and inspire the next generation of design engineers.
The World Bank released its ‘Doing Business 2015: Going Beyond Efficiency’ report last month and ranked South Africa 43 out of 189 global economies for its ease of doing business, with Singapore topping the rankings.
Air Products South Africa officially launched its R300-million Eastern Cape air- separation unit (ASU), at its new manufacturing facility in the Coega Industrial Development Zone (IDZ), earlier this month. It is the second facility that Air Products launched in South...
BMW South Africa (SA) has signed a power purchasing agreement with energy company Bio2Watt. The offtake partnership will bring renewable energy to the carmaker’s Rosslyn plant, north of Pretoria.