Shell Offshore Upstream South Africa has formed a joint venture partnership that is applying to drill for exploration and appraisal off the west cost of South Africa, joining a race by global oil majors to expand activity south of Namibia’s Orange Basin.
Last year, South Africa gave the nod for TotalEnergies to drill offshore, though environmental and other lobby groups resisted the company’s drilling exploration plans.
Fitch Solutions has noted that South Africa’s bid to grow investment into exploration offshore “faces significant downside risk due to the precedents set by previous successful legal cases ruling against oil gas” companies.
Despite this setback and risks, Shell Offshore Upstream South Africa “is applying to undertake exploration and appraisal activities” off the country’s west coast under its partnership that holds exploration rights for a licence for the Northern Cape Ultra Deep Block, said SLR Consulting, a global environment and sustainability solutions company.
Shell Offshore Upstream South Africa has contracted SLR for consultancy on environmental issues related to its plans to drill for exploration off the west coast.
SLR has confirmed that Shell’s “proposed activities include drilling up to five exploration and/or appraisal wells, vertical seismic profiling (VSP), well testing, plugging and abandonment of wells and associated geophysical” surveys.
The block that the company is targeting for drilling is located off the west coast of South Africa between Port Nolloth and Saldanha Bay, and is approximately 300km offshore.
It is made up of water depths of between 2 500m and 3 200m, with the area of Interest for drilling extending to about 5 254 square kilometres.
Albert Milan, director for LWS Research, said Shell was planning to drill exploration and appraisal wells in the area as energy companies shift their focus south of Namibia, where a string of discoveries in its prolific Orange Basin held the potential of more finds.
“The Orange Basin extends southwards into South African waters and has also attracted the interest of rival TotalEnergies, which in March took up acreage in Block 3B/4B, also off the west coast,” said Milan.
However, Shell Offshore Upstream South Africa requires an Environmental Authorisation from the Department of Minerals and Petroleum Resources before it kick-starts the proposed project.
SLR has been roped in to “manage the environmental authorisation” processes.
“The Draft Scoping Report forms part of the scoping phase of the environmental and social impact assessment (ESIA) process, and has been compiled and distributed for public review and comment until August 8, 2024,” ESIA said.
Interested and affected parties are invited to comment on any aspect of the proposed project and ESIA process findings.
Last month, Shell was left pondering its next moves regarding continued investment in offshore exploration for oil after the Supreme Court of Appeal dismissed its appeal against an earlier court ruling that set aside exploration rights and renewals for oil and gas exploration off the Wild Coast.
“However, we welcome the court’s direction that the exploration right remains valid subject to further public consultations and the renewal application,” Pam Ntaka, spokesperson for Shell South Africa told Business Report at the time.
“We are examining the ruling in detail and considering our next steps,” she said.
BUSINESS REPORT