Our Research posts are about the latest academic research being done in the School of Economics. This week:
The Governance of Shale Gas Production in South Africa
by Geoffrey Chapman, Dr. Requier Wait and Prof. Ewert Kleynhans
The proper governance of shale gas mining in the Karoo region of South Africa is important. With an estimated 390 trillion cubic feet (tcf) of recoverable shale gas, large economic gains are possible. This may radically change the South African energy sector. In the United States of America, similar explorations have led to a so-called ‘shale gas revolution’.
The development and production of shale gas hold economic advantages, but also potential environmental costs. The regulation of fracking activities is an important consideration as the Karoo’s shale gas development progresses.
This study reviews the regulations imposed in other countries, as well as the current regulatory framework of South Africa. These regulations are considered in terms of the content of fracking fluid, seismic activity and the pricing regime. Effective regulation will be a key determinant to ensure an overall positive impact of shale gas development on the South African economy and its population.
This research is published in the South African Journal of International Affairs, 23(1):69–88.
Geoff is a Commonwealth PhD Scholar, University of Nottingham, United Kingdom;
Requier is a Manager: Risk Management (Economics), KPMG (SA);
Prof Ewert is at the School of Economics, North-West University, Potchefstroom campus