By Thapelo Molefe
Shell’s bid to search for oil and gas off thes Wild Coast under a disputed exploration right has been brought to an end after the Constitutional Court overturned a ruling that had given the company and Impact Africa another chance to keep their exploration right alive.
The apex court on Friday set aside the 2024 Supreme Court of Appeal (SCA) order and reinstated a 2022 High Court judgment that had cancelled the exploration right.
The ruling ends a years-long legal battle over an exploration right first granted to Impact Africa in 2014, and later shared with Shell. The companies had spent about R1.1 billion on the project.
The Constitutional Court’s majority judgment, written by Justice Jody Kollapen, found that the failure to properly consult affected Wild Coast communities before the exploration right was granted could not be repaired by consulting them more than a decade later.
“Consultation is not merely about the opportunity to express a view or influence an outcome,” the court said.
“On a more fundamental level, regardless of whether the product of consultation has any effect, it is a process which affirms human dignity by affording a seat at the table to those whose lives and livelihoods may be impacted by decisions.”
The court rejected the SCA’s approach of suspending the setting aside of the exploration right to allow the mineral resources minister to consider another renewal application after further public participation.
“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,” the judgment said.
“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 case arose after Impact Africa applied for the exploration right in 2013. It was granted in April 2014 and renewed in 2017 and 2021, despite no meaningful exploration being conducted during the first three-year period.
In June 2021, the director-general approved the transfer of a 50% participating interest in the right to Shell.
Shell announced in October 2021 that it intended to conduct a 3D seismic survey along the Wild Coast in its search for offshore oil and gas.
That was challenged by environmental groups 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. They obtained an interdict in December 2021 preventing the survey from proceeding.
Natural Justice and Greenpeace subsequently joined the litigation.
In September 2022, the Eastern Cape Division of the High Court set aside the exploration right, finding that affected communities had not been properly informed about the proposed seismic survey or given a meaningful opportunity to participate in the decision.
The High Court also found that the minister had failed to properly consider the potential effects on marine life, the communities’ spiritual and cultural rights, livelihoods and climate change.
Claims that the seismic survey would create jobs were also found not to have been properly substantiated.
The SCA in 2024 did not disturb the High Court’s findings that the exploration right and renewals were unlawful, but suspended the order setting them aside. This allowed the minister to consider a further renewal application and conduct another round of public participation in an attempt to address the defects identified by the High Court.
The communities then approached the Constitutional Court, arguing that the SCA’s remedy could not retrospectively cure the failure to consult them before the original right was granted.
The Constitutional Court also rejected the argument that allowing another renewal process would provide a fair opportunity to correct the original failures.
“It would also grant the company respondents a windfall by permitting them, if a decision is made to grant the exploration right, to three more renewals,” the judgment said.
“This would have the anomalous result of conferring a tangible advantage on those who benefited from, and were complicit in, an unlawful process.”
The majority found that the original application was fatally flawed and said Impact Africa had “contributed to the unlawfulness of the decision in disturbing ways”.
It warned against allowing commercial investment to outweigh constitutional rights.
“Any other outcome would allow financial investment to outweigh grave constitutional violations and would signal that the rights of affected parties are subordinate to commercial interests,” the court said.
Seven of the nine judges supported the majority judgment. Chief Justice Mandisa Maya and Justices Mathopo, Mhlantla, Theron and Tshiqi, as well as Acting Justice Musi, agreed with Kollapen.
Justices Owen Rogers and Savage dissented.
Rogers argued that there were no grounds for the Constitutional Court to interfere with the SCA’s remedy and would have allowed the possibility of a final three-year exploration period following proper consultation.
He accepted that the communities’ right to consultation had been neglected and that their cultural, religious and environmental concerns had not been properly considered.
However, he argued that the remedy should accommodate the interests of all parties.
Rogers said the majority judgment had placed the exploration application in “an impermissible twilight zone: supposedly neither granted nor refused, but practically incapable of ever being granted”.
The Wild Coast stretches for about 250km along the Eastern Cape coastline and is home to communities with customary fishing rights and longstanding spiritual and cultural connections to the ocean.
Shell said it had noted the Constitutional Court’s ruling and remained committed to responsible offshore exploration, meaningful stakeholder engagement and environmental stewardship.
Natural Justice director Delme Cupido said the judgment affirmed that public participation was about more than simply complying with a procedure.
“The court affirmed that the right to public participation is not just about following a procedure and ticking boxes, but rather that it is about placing the dignity of our people at the centre of developmental decisions that will affect them,” Cupido said.
INSIDE POLITICS
