South Africa Lifts Moratorium on Shale Gas Exploration in Karoo Region

By Devon Maylie

JOHANNESBURG--South Africa's cabinet Friday said it endorsed a recommendation by the Department of Mineral Resources to lift a ban on shale gas exploration in the Karoo region.

The government in April 2011 placed a moratorium on exploration in the Karoo, an arid area believed to house shale gas reserves, after uproar from environmentalists and concerns from the local community. The Department of Mineral Resources last month presented a report to parliament with recommendations, the details of which haven't yet been released.

"Cabinet approved the report on shale gas exploration submitted by minister of Mineral Resources from the technical task team convened last year," a statement from the government cabinet said Friday. "Cabinet endorsed recommendations of the report on the lifting of the afore-stated moratorium."

A consultant's report last year for the U.S. Energy Information Administration estimated South Africa's recoverable shale-gas resources at 486 trillion cubic feet, which would make them the fifth-largest in the world. A report on behalf of Royal Dutch Shell PLC (RDSB) by a South Africa research firm this year estimated the reserves at 450 trillion cubic feet.

Along with Shell, Falcon Oil & Gas Ltd. and Bundu Oil & Gas (Pty.) Ltd., a South African company that teamed up with Australia's Challenger Energy Ltd., (CEL.AU) also have applied for exploration licenses.

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