Article Feb 2024 – Aloma Jonker
Four delegates from HBC Exco met with Eduard Groenewald (HSE and Sustainability Manager) and Nelisiwe Vundla (Social Performance Lead) of TotalEnergies on 15 February 2024. The meeting was called at their request based on the appeal lodged by the HBC against the proposed oil and gas exploration off the Hermanus coast.
HBC Exco position
The HBC exco position was to listen and understand TotalEnergies’ strategy from two perspectives:
Potential damage to the fragile ecosystem and beautiful coastline of Hermanus and the Overstrand insofar as these attributes are essential to the Hermanus brand and its eco – tourism industry
Potential economic contribution or cost to Hermanus and its inhabitants
Salient Points
The following points summarise the salient details of the discussion
The exploration phase is a fait a compli
There will be no economic benefit to Hermanus during this phase
While the risk of an exploration well blowing is less than 1%, it still presents a potential risk
Exploration is likely to commence at year end although Block 5-6 is not the priority at the moment (rigs are currently allocated Namibia and Congo)
Drilling will likely take place over a 3-4 month period, unless a find is made and appraisal wells are required. In this case the process can take up to a year.
A small platform will be erected to facilitate drilling
Should oil and gas be found the emission profile and economics of the field will be appraised prior to making a decision regarding applying for production rights.
A range of permissions will be required prior to production necessitating extensive studies and permit applications.
This process can take between 2 and 4 years.
Another round of stakeholder engagements will be conducted prior to granting the right to construct a production rig offshore Hermanus area during which interested parties might bring appeals
TotalEnergies holds that rigs will not be visible from Hermanus and that ships will sail directly to Cape Town without disturbing the view from Hermanus and surrounds
There will be minimal economic opportunities even if the field is found to be productive. Cape Town is the port of choice. although locals would be able to bid on procurement contracts and apply for available positions (these will likely be in Cape Town)
HBC Exco Strategy
The HBC strategy is to:
• stay informed,
• communicate developments in connection with the TotalEnergies exploration to members
• facilitate information sessions relating to the proposed exploration for members
• develop a longer term strategy in consultation with knowledgeable environmental, tourism, economic and financial organisations to ensure that the best interests of Hermanus and its business community are served in case the field is considered to be a viable production prospect
• form alliances with organisations with experience in opposition of offshore oil and gas exploration where fragile ecosystems and human environments are at stake should it be required
Next Steps
The newly elected HBC Exco will facilitate a round table discussion on the exploration and desirability or not of this type of project in the Overstrand in conjunction with appropriate organisations for members
Solicit member input and formulate a strategy with respect to oil and gas exploration in the vicinity of the Hermanus coast
Develop an action plan to be ratified by members based on the strategic direction chosen
Conclusion
Exco made a plea that TotalEnergies take into account the fragile ecosystem and potential negative consequences to the tourism industry when making production decisions. TotalEnergies’ response made it clear that they would base their decision purely on financial viability (low emissions profile is also an economic metric). It remains important, however, to protect that which forms the basis of the wealth inherent in Hermanus and the greater Overstrand, namely the natural beauty and fragile marine and terrestrial ecosystems which we are fortunate to inhabit. In light of the foregoing, we should consider carefully whether this is an area conducive to industrial era type industries.
