Apr 13, 2012
Shale exploitation could yield energy, economic benefits – ManuelBack
Johannesburg|Renewable Energy|Mozambique|Namibia|South Africa|United States|Broader Energy Policy|Electricity|Electricity Mix|Energy|Energy Mix|Imported Natural Gas|Indicated Shale Gas Resources|Shale Gas Exploration Licences|Shale Gas Resources|Unconventional Gas Resources|Dipuo Peters|Manuel
© Reuse this
In fact, both Manuel and Energy Minister Dipuo Peters said that gas could play an important role in helping the country transition to a lower-carbon economy and in ensuring that the cost of that transition could be borne by the economy and its citizens.
Shale gas could also play a role, along with imported natural gas from Mozambique and Namibia, in diversifying South Africa’s electricity mix, which was still dominated by coal, which formed the primary energy for more than 90% of the country’s power generation.
A task team had been established by the Department of Mineral Resources to assess the potential costs and benefits of the exploitation of South Africa’s indicated shale gas resources in the Karoo basin, which have been estimated by the US Energy Information Agency as being 485-trillion cubic feet.
In the meantime, a moratorium had been placed on the issuance of shale gas exploration licences and the prohibition would only be lifted once Cabinet had applied its mind to that report.
Manuel noted that the National Develop-ment Report, which had been drafted by the 25-member National Planning Commission, said that the country should factor more gas into the Integrated Resource Plan (IRP) for electricity, which set out a framework for the development of power generation capacity for the period 2010 to 2030. The IRP would be reviewed in 2012, but was only expected to be revised during 2013 once the IEP processes had been completed – the IEP2012 is a multifaceted plan that will guide South Africa’s broader energy policy and guide its electricity and liquid fuels investments over a 20-year horizon.
“The capital costs of gas are cheaper and, in a capital-scarce country, this is an important consideration,” Manuel said, noting that gas could also complement renewable energy and improve the economics of renewables facilities.
He, thus, appealed for a “rational” and “informed” discussion on the potential exploit-ation of South Africa’s unconventional gas resources. “We want to raise the quality of the debate, not the volume.”
But Manuel also indicated that South Africa was unlikely to pursue the unregulated model deployed in the US, referring particularly to the country’s relative water stresses as a key constraint.
“But it can’t be all or nothing,” he said.
Peters added that South Africa’s shale gas potential “cannot be ignored”, as it could bolster supply-side security, contribute to eco-nomic growth and development and help the country in meeting its emission commitments.
“We are cognisant of the controversies asso-ciated with shale gas extraction processes, such as ground water and soil contamination. However, with the ongoing developments, I am confident that these challenges will, in the not- too-distant future, come to pass,” Peters said.
Proposed amendments to the Gas Act would also be presented to Cabinet soon, which could help facilitate greater gas importation and might also facilitate the development of unconventional gas resources.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines
Other News This Week News
Recent Research Reports
Automotive 2014: A review of South Africa's automotive sector (PDF Report)
The report provides insight into the business environment, the key participants in the sector, local construction demand, geographic diversification, competition within the sector, corporate activity, skills, safety, environmental considerations and the challenges...
Construction 2014: A review of South Africa's construction sector (PDF Report)
Construction data released during 2013 hints at a halt to the decline in the industry during the last few years, with some commentators averring that the industry could be poised for recovery. However, others have urged caution, noting that the prospects for a...
Electricity 2014: A Review of South Africa's Electricity Sector (PDF Report)
This report provides an overview of the state of electricity generation and transmission in South Africa and examines electricity planning, investment in generation capacity, electricity tariffs, the role of independent power producers and demand-focused initiatives,...
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
Road and Rail 2013: A review of South Africa's road and rail infrastructure (PDF Report)
Creamer Media’s Road and Rail 2013 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...
Liquid Fuels 2013 (PDF Report)
Creamer Media’s 2013 Liquid Fuels report examines South Africa’s liquid fuels market, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing,...
This Week's Magazine
A structured approach, wherein managers personally engage at each level of the project, is necessary to mitigate delays to the workflow on mega construction projects, says State-owned Eskom Kusile power station projects GM Abram Masango. The 4 800 MW Kusile power...
Construction of transmission lines to evacuate power from a regional hydroelectric project in East Africa, which was hanging on the balance following the withdrawal of financing by key partners, is now back on track. After six months of uncertainty, the African...
Three Memorandums of Understanding (MoUs) were signed between South African and Malaysian companies at the Malaysian High Commission in Pretoria on Friday. These MoUs are part of the indirect offsets programme South Africa is providing in return for Malaysia’s...
The South African new vehicle market may well dip to 640 000 units in 2014, says Toyota South Africa Motors (TSAM) sales and marketing senior VP Calvyn Hamman. This is the first prediction that anticipates a drop in the market. To date economists and industry bodies...
Nissan will re-enter the South African minibus taxi industry in March, when the new NV350 Impendulo goes on sale. The 16-seater has been specifically tailored to meet the terms of government’s Taxi Recapitalisation Programme, which aims to replace South Africa’s...