South Africa’s Karoo basin has about a thirtieth of the shale gas deposits than some estimates suggested, deflating expectations of an energy bonanza, a study published on Sept. 28 said.
The South African Journal of Science’s findings have been published shortly before the awarding of the first shale gas exploration licenses in the region. The government had said an award could happen by the end of September.
The gas development plans have drawn opposition from campaigners that said the plans threaten the environment of the semi-arid Karoo, famed for its rugged scenery and rare wildlife.
Geologists at the University of Johannesburg and three other institutions estimated the gas resource was about 13 trillion cubic feet (Tcf), the bottom of a range of estimates that had put deposits between 13 Tcf to 390 Tcf, the study said.
In 2015, the U.S. Energy and Information Administration (EIA) estimated the Karoo Basin’s “technically recoverable shale gas resource” at 390 Tcf, making it the eighth largest in the world and second largest in Africa, behind Algeria.
At 13 Tcf, it ranks thirty-fourth out of 46 nations in EIA estimates.
However, the authors of the study said that “such low estimates still represent a large resource with developmental potential for the South African petroleum industry.”
“To be economically viable, the resource would be required to be confined to a small, well-delineated ‘sweet spot’ area in the vast southern area of the basin,” they said.
The study said previous estimates were “speculative” and had been made without measurements of gas content.
Environmentalists and farmers have opposed opening up the Karoo for shale gas development, which would require “fracking”, a technique involving pumping water and chemicals at high pressure to crack the rock and release the gas.
Royal Dutch Shell (NYSE: RDS.A), Falcon Oil and Gas and Bundu Gas & Oil are among five firms whose applications were being reviewed by the regulator.
Recommended Reading
Aethon Cuts Rigs but Wants More Western Haynesville Acreage
2024-03-28 - Private gas E&P Aethon Energy has drilled some screamers in its far western Haynesville Shale play—and the company wants to do more in the area.
Elk Range Royalties Makes Entry in Appalachia with Three-state Deal
2024-03-28 - NGP-backed Elk Range Royalties signed its first deal for mineral and royalty interests in Appalachia, including locations in Pennsylvania, Ohio and West Virginia.
Dallas Fed Energy Survey: Permian Basin Breakeven Costs Moving Up
2024-03-28 - Breakeven costs in America’s hottest oil play continue to rise, but crude producers are still making money, according to the first-quarter Dallas Fed Energy Survey. The situation is more dire for natural gas producers.
OEP Completes Acquisition of TechnipFMC’s Measurement Solutions Business
2024-03-27 - One Equity Partners said TechnipFMC’s measurement solutions business will be rebranded as Guidant and specialize in measurement technology, automation solutions and global systems.
PE Investors Scoop Up Offshore Services Provider Acteon Group
2024-03-27 - Acteon Group, a U.K.-based subsea services provider serving customers in offshore oil, gas and renewables, was acquired by new private equity backers.