Where to now for Shell as environmental activists gear up for new battle?

At the moment we don’t have sufficient sources to satisfy the needs of today’s world: Hloniphizwe Mtolo, Shell SA country chair, with Wilmien Wicomb, a Legal Resources Centre attorney.

FIFI PETERS: The Amazon Warrior, which was the ship hired by Royal Dutch Shell to look for potential oil and gas fields along the Wild Coast has left South African waters. This after community groups won a court case to temporarily halt the activity over what the seismic activity would do to the environment and the fishing community.

We have Hloniphizwe Mtolo, who is the South African country chair of Shell, to speak to us a bit more about this case but, more importantly, where to now for Shell?

Hloniphizwe, thanks so much for your time. Our energy minister has been making some comments about this particular case of late. I don’t know if you would’ve seen them, but he’s come to your defence, essentially saying that the exploration across the Wild Coast was legally compliant and the potential impacts had very low significance for the environment. What do you make of the support of South Africa’s government for your exploration?

HLONIPHIZWE MTOLO: Thank you for having us on the show. From our perspective, we appreciate the comments that are made by the ministry, because we believe and strongly believe, if I may add, that this activity that we were embarking on is good for the country as we look to government to support us on doing something that is good for the country. From that point of view we appreciate the comments that were made by the minister in terms of supporting our position and supporting what we are doing, and also telling the public in terms of the impact the survey will have on the environment, and sort of bring people up to speed and allay people’s fears in the potential danger that is being put out there – which we don’t believe is the true fact of the matter.

FIFI PETERS: Yet, despite not having your day in court over December, I believe there was an option for you to appeal the ruling that went against you. Shell chose not to do so – why is that, why did you choose to temporarily halt the exploration?

HLONIPHIZWE MTOLO: We’ve temporarily sort of suspended the seismic sounding and we’ve done that on two sides. The first one is from an economic point of view. It is very expensive and economically heavy on us to keep the vessel on our waters while it’s not doing anything. So from an economic point of view it did not make sense for us to keep the vessel any longer. That’s first off.

The second part is the fact that the seismic window is limited. In South Africa you can only do a seismic survey in this particular area between December and around April. The reason for that is that we watch very carefully the periods that are important to the wildlife, like the migration of whales and all of those things. We have to take those things into account when the decision is made to do the survey.

Because of those two reasons – the one is the economic reason that is expensive for us, and the second one is the limited window period – we’ve decided that we would halt and suspend the activities and go through all our options, legal options, in terms of appealing, and the second pertains to the legal property that is still pending. We want all of these things from a legal point of view to take care of themselves, and we’ll then make a decision in terms of when we continue.

In all likelihood, if the court finds in our favour, we’ll possibly do this around January 2023.

FIFI PETERS: I imagine that you do appreciate that it’s not going to be an easy fight, and in fact we have the legal aid [representative] that represented some of the environmentalists who went up against you regarding this particular project, Wilmien Wicomb, who is the attorney from the Legal Resources Centre.

Wilmien, thanks so much for your time. What do you make of what Minister Gwede Mantashe has said in support of this project, and his comments around the protests against the exploration of oil and gas in this country potentially harming energy security, given that gas is going to be a bigger part of our energy plan in future.

WILMIEN WICOMB: Thank you very much for having me. I think two things. The one is the minister’s comments that he believes that Shell acted lawfully. That’s not new. He entered the interdict proceedings in court in December, shortly before the hearing, and he also placed that before the court. That is not news to us. It is unfortunate, I think, that the minister is taking a position that we think is legally incorrect. As the regulator he would hope that, from the side of the government, they would be the ones who could clarify the legal position. We don’t think that’s the case here. That’s the one thing that’s not very significant – what he said. We knew that before and that’s really a legal question for the courts to settle.

I should say that the question as to whether Shell was required to do an environmental-impact authorisation in terms of our environmental legislation, that question has not been dealt with by the court; it will still come before the court. We clearly have our different views on it, but that will be decided.

On the comments that the minister made around the protest, we of course know he made comments on Twitter before the hearing, really disparaging comments. I have to say the clients that I represented in the interdict against Shell are small-scale fishing communities and they were accused by the minister of being kind of profit-taking in a new wave of apartheid which they found ludicrous and insulting, in particular because these are communities that have been ignored for decades by the minister.

So it’s perhaps not surprising that a corporate coming in thinks that it can do the same. But the court was very clear that that cannot happen. So we must separate the issues here. Everyone has the right to protest and in the same breath everyone must act lawfully. If actions are not lawful, even if they are understood to be in the best interest of the country by the minister, then the court must set them aside.

I think that we must separate the issues here. At this point I think it’s very clear that the minister cannot rush Shell into going ahead until the courts clarify this either way.

FIFI PETERS: All right. I see, looking at an article in front of me, there is another seismic survey that is set to begin in the middle of the month off the Western Cape coast by the Australian company Searcher Seismic, in collaboration with Petroleum Agency SA. Just your stance on that? What are you planning to do with that seismic survey?

WILMIEN WICOMB: Yes, indeed. That private survey is planned for the entire West Coast, from the Namibian border all the way down. Again, the small-scale fishing communities on the West Coast largely had no idea until this news surfaced in the media a couple of weeks ago.

Yes, we have been instructed by them to investigate how that happened and it will probably also end up in court.

FIFI PETERS: Okay. Hloniphizwe, we’re living in an environment now where there’s more and more concern around the environment and how we operate in it. Just yesterday we had the World Economic Forum’s Global Risks Report which cited climate change as one of the biggest threats to the global economy in terms of impact. I’m just wondering what lessons you have drawn from this particular incident here in South Africa, and how it might influence how you go ahead with similar exploration activities in future.

HLONIPHIZWE MTOLO: Thanks for that question. Indeed we are all very concerned about climate change and we are all working towards a just transition as far as energy is concerned – and Shell is very much committed to that just transition.

What we need to be very careful of as a society is that the energy transition is exactly that; it’s a transition. It is not a switch. So in that space we are talking about how we satisfy the energy needs of the world today. As such, we need to be doing activities that talk to the energy needs of the world of today, taking into account the shift to renewable and cleaner energies. So the shift is a just transition over time.

What that effectively means is that we slow down, we do not stop. We slow down our investments. And when I say ‘our investments’, I’m talking about world investments in the current and available energy sources. So we slow down while we start the ramp up of renewable energy because, if we just stop, the world is going to be in a predicament in that we’re going to run out of energy, because we don’t at the moment have sufficient sources that can satisfy the needs of the world of today.

So if you look at Shell’s investment profile, you can see the ramping up of investments in renewables and new energies. That’s being ramped up quite significantly, and you can see a slowing down of investments into the hydrocarbons. But you do not see an immediate stopping because, as I’ve just indicated, we still have to serve the needs of the world today.

FIFI PETERS: All right. The sense I’m getting from both of you is that this case is not over yet, and we look forward to speaking with you when there are developments on the Market Update. Thank you to Hloniphizwe Mtolo, the South African country chair of Shell, as well as to Wilmien Wicomb, the attorney for the Legal Resources Centre, representing most of the environmentalists that have gone up against the recent seismic surveys on the Wild Coast, as well as one coming up on January 25.

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