British energy giant Shell’s plan to search for oil and gas off South Africa’s Wild Coast has come to an end after the African country’s Constitutional Court set aside its exploration rights on Friday.
The ruling overturns a 2024 Supreme Court of Appeal (SCA) decision that had upheld the exploration right. That decision gave the mineral resources department a chance to keep the project alive by going back to the Wild Coast communities for the proper public consultation that never happened in the first place.
Impact Africa was granted the right in 2014 and brought Shell in on a half share seven years later, with the two companies spending about R1.1bn on it. It was first scrapped by the Makhanda High Court in 2022, which found the communities had never been properly told what a seismic survey off their coast would involve.
Friday’s order reinstated that judgment, striking down the 2014 decision granting the right along with the two renewals that followed. Seven of the nine judges backed the majority judgment, written by justice Jody Kollapen, with chief justice Mandisa Maya, justices Mathopo, Mhlantla, Theron and Tshiqi, and acting justice Musi agreeing.
The court found that consulting the communities now, more than a decade late, and then taking the decision again would not repair the violation. “Consultation is not merely about the opportunity to express a view or influence an outcome,” the court said.
“To tell communities, more than a decade after the fact, that they may now be consulted, would not be curative to their right to dignity.
“Instead, it would say to them that the violation of their rights was not a matter of substance but rather a matter of process.”
The move would also have allowed the companies to get around a government moratorium that now blocks new exploration rights along the entire SA coast. The court found the original application was fatally flawed and that Impact Africa “contributed to the unlawfulness of the decision in disturbing ways”.
Any other outcome, it held, “would allow financial investment to outweigh grave constitutional violations and would signal that the rights of affected parties are subordinate to commercial interests”.
The Wild Coast is a 250km strip of Eastern Cape shoreline carrying customary fishing rights and spiritual practices for the communities living along it. Impact Africa applied for the right in 2013 and was granted it on April 29 2014, then had it renewed in 2017 and 2021 without doing any meaningful exploration in its first three-year term.
The director-general signed off in June 2021 on the transfer of a 50% participating interest in the right to Shell. In October that year Shell gave notice that it would start a 3D seismic survey along the coast, and Sustaining the Wild Coast, All Rise Attorneys for Climate and Environmental Justice, members of the Umgungundlovu and Dwesa-Cwebe communities, Wild Coast fishers and Kei Mouth Fisheries obtained an interdict stopping it that December. Natural Justice and Greenpeace later joined the case.
The high court set the right aside in September 2022 on three grounds, finding that affected parties had never been properly told what the survey involved or given a real chance to respond, that the minister had ignored the harm to marine life, the communities’ spiritual and cultural rights and climate change, and that the claims the survey would create jobs had not been backed up.
The SCA agreed the right had been granted unlawfully but suspended the setting aside so that the minister could still decide a third renewal application, with a further round of public participation to cure the defects. The communities took that order to the Constitutional Court, which heard argument in September last year and found the renewal process does not allow for the kind of consultation the SCA had in mind.
In a dissent, justice Owen Rogers, with justice Savage agreeing, said there were no grounds to interfere with the SCA’s remedy and would have preserved the possibility of a final three-year exploration period after proper consultation.
Rogers accepted that the communities’ right to be consulted had been neglected and their cultural, religious and environmental concerns not properly considered, but held that a fair remedy had to accommodate all sides. The majority’s order, he said, had consigned the application to “an impermissible twilight zone: supposedly neither granted nor refused, but practically incapable of ever being granted”.