The Transkei Basin: Risking our heritage for ten days of fuel

The ongoing legal and ethical battle over seismic blasting and offshore exploration along the Wild Coast is often framed as a conflict between "development" and "conservation." This is a false dichotomy. When one looks at the hard data, it becomes clear that this is not a debate about development, but about a reckless gamble with odds that no actuary would accept.

Proponents of the exploration, including the Department of Mineral Resources and Energy, tout the "multi-billion barrel potential" of the Transkei and Algoa basins as a cure-all for South Africa’s energy woes. However, we must contextualize these numbers against reality.

The world currently consumes approximately 100 million barrels of oil per day. If explorers were to find a "giant" field of one billion recoverable barrels—a massive geological success by any standard it would sustain global consumption for merely ten days. We are being asked to risk the permanent integrity of one of the world's most biodiverse marine environments for a resource yield that constitutes a statistical drop in the global ocean.

Financially, the public is being misled. The heralded "20% State stake" is not a windfall; under the Upstream Petroleum Resources Development Act, it is effectively a loan. The State’s share of the massive infrastructure costs is "carried" by the oil majors, meaning we must pay them back from future revenues before seeing a cent. Furthermore, royalties are calculated on profitability, not just revenue. By amortizing the billions spent on deepwater rigs, operators can legally suppress royalty payments to the statutory minimum of 0.5% for years. We are mortgaging our coastline for a return that may barely exceed a rounding error.

The physical risks are equally understated. The Transkei Basin is not the North Sea or the Gulf of Mexico. It sits in the path of the Agulhas Current, the strongest western boundary current in the Southern Hemisphere. Oceanographers have long documented the phenomenon where this southwest-flowing current collides with strong south-westerly winds, creating "rogue waves" that can exceed 30 meters in height. These are not 1-in-100-year anomalies; in the Agulhas stream, they are a predictable feature. To station floating or fixed-rig infrastructure in such a volatile hydrodynamic zone is to invite catastrophe.

We are facing a scenario where short-term, speculative profits, which often evaporate into the pockets of multinational shareholders and a connected few, are prioritized over the sustainable, long-term economy of our coastal communities. The eco-tourism and fishing sectors provide livelihoods that last generations. An oil rig, even if it survives the waves, offers us only a fleeting extension of fossil fuels in an insane world that should be focusing on renewable resources.

It is time to look at the facts, acknowledge the financial and physical dangers, and accept that the Transkei Basin is the wrong place for this old 'fossil' industry.

Resource curse / extractive economy

Proponents claim that it will provide a significant contribution to South Africa’s energy requirements. However, estimates indicate South Africa currently imports over 90% of its refined fuel products.

Jet A1 and diesel are the biggest imports and the lifeblood of industry AND Eskom which relies far more heavily on OCGT than we are led to believe.

• SAPREF (Durban): The largest refinery (formerly Shell/BP) is shut down. The state bought it for R1 to "save" it, but it remains inactive.
• ⁠ENREF (Durban): Shut down and being converted into a storage terminal.
• ⁠PetroSA (Mossel Bay): The Gas-to-Liquids plant is largely idle due to lack of feedstock.

The Pipeline Problem:

To bring gas from the Transkei Basin to the nearest industrial zones (Coega in Gqeberha or Richards Bay), would optimally require hundreds of kilometers of subsea or overland pipelines.

Given the "hundred-year waves" and the Agulhas Current, building and maintaining a subsea pipeline on the "Wild Coast" is technically perilous and prohibitively expensive.

The likely Model for deepwater fields in rough oceans is typically an FPSO (Floating Production, Storage, and Offloading) vessel.

This floating 'rig' pipes the oil/gas, stores it on board, and offloads it directly onto visiting tankers.

The oil never touches South African soil as we have no capacity left to refine it. It goes from the rig straight to an international refinery. The gas could be shipped to Coega.

While the Coega SEZ (Special Economic Zone) has plans for a 1000MW gas-to-power plant, they are currently looking at importing LNG (Liquefied Natural Gas) to run it because there is no way to get domestic gas there. Yet.