Shell Plc lost the latest round of a five-year legal fight with environmental activists over a South African oil-exploration campaign that went all the way to the nation’s top court.
The oil major won’t be allowed to renew an exploration right off South Africa’s rugged Indian Ocean Wild Coast, the Constitutional Court ruled on Friday. The decision comes as other offshore South African oil searches are challenged, while Namibia approaches the development of crude discoveries just over the maritime border.
“What the ConCourt decided was that the exploration right should be set aside,” said Melissa Groenink Groves, an attorney and program manager at Natural Justice, an applicant in the case.
The decision could further embolden activists who have had multiple victories in court against oil explorers.
A Shell spokesperson said the company had noted the judgment.
“We are committed to responsible offshore exploration, meaningful stakeholder engagement and environmental stewardship,” the spokesperson said in an emailed statement. “South Africa is currently reliant on energy imports for many of its energy needs. Shouldonomic development programmes.”
The legal saga began in 2021 with activists opposing a seismic survey planned by Shell and a local partner in an area where whales are frequently spotted.
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Environmental groups won an interdict that halted the exploration activity over concerns that communities weren’t properly consulted, and about the impact the survey would have on local residents and marine life.
The following year, a high court set aside the decision to grant the exploration right, along with two subsequent renewals. Shell’s appeal was dismissed, though the Supreme Court of Appeal later handed the London-based company a reprieve by ruling that a third renewal, which was pending, could proceed subject to proper consultation.
Environmental groups argued that the Appeals Court erred by giving Shell the opportunity to apply for renewal of a right that has been set aside and, therefore, no longer exists.
Shell and TotalEnergies SE are among the explorers looking to utilize prospects to drill offshore South Africa, after discoveries in Namibia’s waters in 2022 turned the area into one of the continent’s exploration hotspots.
TotalEnergies SE Chief Executive Officer Patrick Pouyanne described South Africa as having a complex legal environment to explore. “Each time we want to do it, we need to go to court,” he said in a Nov. 30 earnings call. “It’s a little difficult.”
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