The Upstream Petroleum Resources Development Bill currently being considered by the Parliamentary Portfolio Committee for Mineral Resources and Energy is fatally flawed and should be rejected by South Africans.
The bill will create a separation of the regulation of the upstream petroleum industry from the regulation of the mining industry, with the former regulated by the bill and the latter continuing to be regulated by the Mineral and Petroleum Resources Development Act.
This split is significant as it means a new regime for the regulation of South Africa’s nascent gas industry would come into effect.
However, the draft bill completely disregards the climate emergency and will cause South Africa to fall foul of our climate change commitments.
Furthermore, it lacks any mechanism to ensure local economic development, something arguably central to the imperative of the alleviation of poverty and reduced inequality.
Climate change
The bill purports to accelerate the exploration and production of gas, a fossil fuel for which South Africa lacks the necessary infrastructure, ignoring the global climate emergency.
The exploitation of gas resources through extraction and processing contributes towards global warming through the release of methane.
Methane is a potent greenhouse gas. Over a 20-year period it has an 84 times higher global warming potential than carbon dioxide.
Although gas companies claim to be able to limit the impact of methane, methane leakages during numerous phases in the gas supply chain can be anywhere between 2.8 – 7.9%. It is estimated that even a 2.7% methane leakage would negate any climate benefits that gas has over coal.
International institutions such as the United Nations Intergovernmental Panel on Climate Change and even the International Energy Agency confirm that climate change is human-made and we must limit global warming to 1.5ºC above pre-industrial levels in order to avert the worst effects of climate change. Already, we are seeing droughts, excessive heat waves and floods.
Yet the bill does not refer to climate change, nor does it have any mechanisms for ensuring that gas companies may only operate provided they do not contribute towards worsening the climate crisis.
Instead, it prescribes that exploitation of oil and gas must be accelerated.
The bill must undergo an about turn if South Africa hopes to meet its international obligations to decarbonise and protect its citizens from harm.
Local economic development
In order to avert climate catastrophe, we need to rapidly decarbonise and move towards net-zero emissions, and this transition must happen in a manner that is just and equitable.
The extractives industry leaves injustice and inequality in its wake. Mining and gas companies often force their will on local communities in order to extract mineral and petroleum resources, subsequently leaving those local communities to carry the concomitant adverse impacts as a result of land that has been devastated, air that has been polluted, and water that has been filled with carcinogenic and radioactive toxins.
While the mining and gas companies make obscene profits through this extraction, local communities are left with little to no economic or other benefit. If anything, they are forced to carry the economic and social burden of increased morbidity and mortality caused by the impacts of mineral and petroleum extraction.
The bill makes no attempt to address such injustice.
While the bill speaks about expanding opportunities for black people and promoting local employment, it is silent on how it will alter an exploitative extractives industry where mining and gas companies often win against disadvantaged local communities in a cruel zero-sum game.
Experience has shown that people in local communities where gas companies operate are often not eligible for employment by them. The bill makes no provision for a social and labour plan, nor any alternative mechanism for the benefit of local communities. Nor does the bill address gender injustice when we know that large-scale extraction projects often impact women more severely.
The bill’s purported aim to advance the social and economic welfare of all South Africans is lip service only. Its actual provisions leave us staring down the barrel of irreversible climate catastrophe. It should be rejected.
