An aerial view of a shale oil drilling rig

South Africa lifts moratorium on shale gas exploration

South Africa has lifted a moratorium on shale gas exploration, allowing the extracting technique of "fracking".

Collins Chabane, a minister in the President's office, said the cabinet had decided to lift a moratorium, imposed in April last year, after a study eased safety concerns related to the controversial method.

"When (the results of the study) came back, they recommended that it was clearly safe for us to have that programme of exploration of shale gas," Chabane said.

According to an initial study commissioned by the US energy information administration, South Africa has 485 trillion cubic feet of technically recoverable shale gas resources, most of which are located in the vast Karoo Basin.

The reserves, which would rank as the fifth largest among 32 countries included in the study, could be a long-term solution for the energy problems of Africa's largest economy, which relies on coal to produce 85 per cent of its electricity.

A revocation of the moratorium could benefit Royal Dutch Shell, Falcon Oil & Gas, Sunset Energy and Anglo American, the Eurasia political risk consultancy said earlier this year, adding the move could be "a game changer" for South Africa's economy.

Oil major Shell said last year it hoped to invest $200m to explore for shale gas in the Karoo.

Petrochemicals group Sasol put its shale gas exploration plans on hold in November, but said it would watch further developments.

South Africa last year imposed a fracking moratorium on oil and gas exploration licences in the Karoo region, to give time to study the potential gains and examine the concerns of environmentalists who say the process would ruin the area.

Ferrial Adam, a climate and energy campaigner at Greenpeace Africa, said the decision could start a process that could have a devastating impact for the region.

"At the end of the day it is still fracking. They are going to use a lot of water with a enormous amounts of chemicals in them in an area that is water scarce," she said.

Fracking, or hydraulic fracturing, involves pressurised water, chemicals and sand being pumped underground to release gas trapped in rock formations.

It has been opposed by landowners and environmentalists who say the process can pollute water supplies.

However, it has been increasingly taken up in the US, releasing huge quantities of natural gas and setting an example that other countries with shale gas reserves are keen to follow.

Jonathan Deal, chairman of anti-fracking Treasure the Karoo Action Group, said the decision was "hasty" and "ill-informed".

"If any exploration licenses are issued in future, we will appeal and naturally resort to litigation should our appeals fail," he said.

"The only way to defeat this technology permanently is to get a ruling in the country's highest court against fracking on environmental grounds."

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