SCA ruling puts temporary halt to fracking
Publish date: 08 July 2019
Issue Number: 831
Diary: IBA Legalbrief Africa
Category: South Africa
The SCA has ruled that the Minister of Mineral Resources did not have the power to make regulations for petroleum exploration and production, effectively halting the exploration of shale gas through the use of hydraulic fracturing (fracking). TimesLIVE notes the SCA also set aside the petroleum regulations in their entirety. The SCA ruled on two cases consolidated for the hearing. In one case brought by Karoo farmers, the Eastern Cape High Court (Makhanda) had held that the Minister was not empowered to make the petroleum regulations which were promulgated in 2015. However, the Gauteng High Court (Pretoria) – in a case brought by Treasure the Karoo Action Group and AfriForum – had ruled in favour of the Minister on the same issue. The matter has its genesis between 2008 and 2010, when three entities applied for rights to explore for shale gas in the Karoo through fracking. The Minister of Mineral Resources established an interdepartmental task team to evaluate the potential risks posed by fracking. The result was that the Environment Minister, the Mineral Resources Minister, and the Minister of Water Affairs entered into an agreement in respect of the management of environmental impacts of activities under the Mineral and Petroleum Resources Management Act (MPRDA). The agreement, known as the One Environmental System, was that all environmental aspects would be repealed from the MPRDA and that these would fall under the control of the Environment Minister under the National Environmental Management Act (Nema). Despite this agreement, the Minister of Mineral Resources promulgated the petroleum regulations in 2015. These regulations were then challenged in the two cases.
The SCA held that the implementation of the One Environmental System divested the Minister of Mineral Resources of the power to make regulations. ‘As I have shown, the One Environmental System envisaged that all environmental aspects relating to prospecting, exploration, mining or production in terms of the MPRDA would be regulated through Nema and its subordinate legislation. It is plain that this includes making regulations regarding the management of the environmental impacts of these activities,’ Judge Christiaan van der Merwe said in a unanimous judgment of the full Bench. According to TimesLIVE, Van der Merwe said as a result, the only regulation-making powers regarding the environmental impacts of these activities, were those vested in the Environment Minister in terms of Nema. Van der Merwe added exploration for petroleum by hydraulic fracturing should not take place at all before it was lawfully regulated.