The Total cost of offshore mining for South Africa
The recent gas discovery off South Africa’s coast is ripe with economic opportunity, particularly for the economic empowerment of the most disadvantaged demographic in our labour market — black women.
But South Africa’s mineral and petroleum legislation in its current form provides no framework for regulating offshore exploration and exploitation and the department of mineral resources is ill-suited to consider the environmental risks associated with these activities.
The country, whose vast coastline of about 3 000km is washed by the waters of the Atlantic and Indian oceans, enjoys exclusive access to living and non-living resources in its waters, the seabed and its subsoil up to about 200 nautical miles from its coast.
This is because South Africa ratified the 1982 United Nations Convention on the Law of the Sea and gave effect to the provisions on maritime jurisdiction by promulgating the Maritime Zones Act (15 of 1994). Among other things, the convention provides that a coastal state has exclusive access to explore and exploit the resources within its legal zones.
Exploration, such as that undertaken by Total off South Africa’s coast, and any ensuing economic benefits were among the aims of African states during the negotiations that culminated in the adoption of the convention.
Our ambition was anchored in our right to self-determination after the damage wrought by colonialism. Our former leaders considered our adjacent ocean spaces and the resources they contain to be part of the foundation on which the continent’s economic and socioeconomic development could be built.
Since then, South Africa has been part and parcel of processes aimed at birthing and sustaining the continent’s true economic potential at sea.
At a continental level, this is best captured by the 2050 Africa Integrated Maritime Strategy (2050 Aims), which was adopted by the African Union member states and, at a regional level, South Africa’s involvement in the Benguela Current Commission (BCC) and the Indian Ocean Rim Association (IORA).
The 2050 Aims is the roadmap crafted by African leaders to use the continent’s ocean spaces to contribute towards meeting its ambitions.
Regionally, as it pertains to the Atlantic seaboard, South Africa, Namibia and Angola comprise the BCC, whose mission includes the “conservation, protection and sustainable use and management of the Benguela Current large marine ecosystem”.
On the eastern seaboard, South Africa is a member state of the IORA, whose objectives include, among others, the promotion of “sustained growth and balanced development of the region and of the member states, and to create common ground for regional economic co-operation”.
Among the IORA’s focus areas is fostering a blue economy in the region, which entails promoting smart, sustainable and inclusive growth, as well as the economic empowerment of women.
This led to the adoption of the Balaclava Declaration on Women’s Economic Empowerment and Gender Equality in August last year as a prerequisite for sustainable development.
Accordingly, IORA member states have, among other things, affirmed that they will “promote an enhanced representation of women in leadership and in the workforce at the top and middle managerial levels by intensifying human capital development; capacity and capability development programmes that would seek to empower women on a level playing field; whilst addressing the structural barriers that contribute to the importance of economic empowerment”.
Domestically, South Africa’s Operation Phakisa on an ocean economy echoes the continental and regional visions. In fact, the exploration and exploitation of offshore petroleum resources is envisioned to be among those industries that will unlock South Africa’s ocean economy, with skills and capacity building seen as an enabler.
Other than the much-needed tax revenue the state will generate from such activities, a more glaring opportunity presents itself for our government to prioritise the upskilling and access of women in South Africa’s new economic frontier. Prioritising this will ensure that implicit to South Africa’s ocean development strategy is the economic empowerment of women, thus partially contributing towards addressing the challenges that confront women not only in accessing the labour market and being compensated fairly but also in assuming leadership in South Africa’s so-called economic game-changer.
A concern about the gas discovery is the adequacy of South Africa’s mineral and petroleum legislation to address issues associated with offshore petroleum exploitation. In its current form, the Mineral and Petroleum Resources Development Act (28 of 2002) is in inadequate. Minerals Minister Gwede Mantashe has realised this and declared that a draft oil and gas Bill will be developed.
Environmental management and mitigation against the adverse effects of offshore petroleum exploitation are key to the success and sustainability of this emerging sector. According to the Act, the minerals minister is the responsible authority for implementing environmental provisions in terms of South Africa’s environmental legislation as it relates to activities such as mining, exploration and production.
The function of granting environmental authorisations for mining activities would be better housed in the department of environmental affairs because, on the one hand, environmental affairs’ mandate is primarily concerned with giving effect to the environmental provisions enshrined in our Constitution, which include protecting the environment for the benefit of future generations.
On the other hand, mineral resources is concerned with promoting and regulating the mining sector to derive sustainable benefit from South Africa’s mineral wealth. As such, it is unlikely to protect the environment from exploitation to the same extent as environmental affairs.
Maintaining the status quo in developing oil and gas legislation will fail to optimise the appropriate checks and balances in ensuring that development of the sector causes the least possible damage to South Africa’s marine environment. Just because we have access to petroleum resources does not mean we have to exploit them, especially when this may cause more harm than good.
The opportunities and concerns presented by Total’s gas discovery require serious consideration if South Africa is to benefit sustainably from unlocking its economic potential at sea.
Yamkela Ntola is portfolio manager: water and environment at the Organisation Undoing Tax Abuse. He is currently doing an MPhil, specialising in sustainable mineral resource development, at the University of Cape Town