Wednesday, March 16, 2011

IN SOLIDARITY WITH THE HEARTLAND : PART II, Karoo fracking: Forewarned is …

Geraldine Bennett|

16 March 2011 10:01

Sutherland fights back: Royal Dutch Shell CEO salary rises to E5.36m in 2010.

Coinciding with the start of the second round of public participation meetings in South Africa’s Great Karoo, Royal Dutch Shell released its 2010 annual results posting a 63% increase in CEO, Peter Voser’s 2010 pay-package.  In the next three years the petroleum supermajor plans on spending $100bn on new projects. 
The Golder’s show
Just over two hours into the first public meeting in the second round of engagement between fracker’s Shell and their consultants, Golder, in Sutherland, Jonathan Deal, spokesperson and national coordinator of TKAG (Treasure the Karoo Action Group) had begun to wonder what part of the proceedings were participatory. 
Scheduled for three hours the meeting dragged on. 
For the next ten towns along the way, unless Golder and its groupies dramatically change their plans, interested and affected parties (I&APs) spanning the Karoo can anticipate death by power point for 65% of the public “participation” process. 
According to Deal, an additional three meetings have been added as a result of pressure from I&APs who feel that the original schedule displayed a lack of consideration for distances to be travelled.  We are talking over 90 000 square kilometres. 
Pressure from Somerset East, Pearston and Calvinia has compelled Golder to double up some days, extending the road show by a further day. 
In the meantime Deal believes strongly that there is little time for public engagement after Shell and Golder’s paralysing power point presentations. 
There are other things that bother Deal too. 
According to Deal, Shell’s Tony Cortis insinuates that the extension on the banning or moratorium on fracking by French Prime Minister, Francois Fillon, on Monday 13 March, is because “he doesn’t understand it”.    
Then there’s the matter of the amount of time allowed for response. 
Says Deal, “I&APs get 20 working days when you do the maths.  This is a technical document of over 250 pages.  If the French prime minister doesn’t understand fracking then what’s the chance the average Karoo farmer will?” 
“Golder had a technical cooperation permit which they applied for a year ago and it is very clear that they have been developing the draft EMP for the last year,” says Deal.
For Deal one of the toughest things to hear is that Karoo farmers have become apathetic.
He says, they believe that it’s a fait accompli, and that “between big business and government, in bed together, there’s nothing anyone can do”.  If this sentiment prevails then we may as well say “Good-bye Great Karoo”. 
Deal nonetheless commends Golder on its professionalism in the face of such hostility.
“I believe they are doing the best possible job for the company, but deep down inside some of them at senior level are feeling that they do not have the moral high-ground.”
Deal says it’s like a defence lawyer knowing he’s defending a rapist or murderer.
“Reading between the lines; and the body language” he says, “they are taking strain.  They are in a very unpopular position.  People don’t trust their independence or them, and see them as this great conspiracy to ruin their lives.” 
Alarm bells
Coinciding with the start of this second round of public participation meetings in the Karoo, Royal Dutch Shell (RDS) hosted an investor’s conference after releasing its annual report for 2010. 
There is every indication that the supermajor is rigorously committed to the pursuit of upstream activities.  Upstream includes exploration for new gas and oil resources, with the ultimate intention of exploitation, commonly referred to as “production”. 
RDS is signalling a serious drive until 2014 with every indication of investing vast sums of money into new projects.  It is projecting a 12% increase in output target over the next three years. 
For the residents of just over 90 000 square kilometres of the Great Karoo this should sound warning bells. 
With concerns that demand will eventually put pressure on supply the petrochemical giant, worth around £56bn, is determined to forge ahead and feed the unquenchable fossil fuel thirst.     
Shell has stated that “it expects over $100bn of net capital investment for 2011-14, some $25bn-$27 bnper year …to underpin the Upstream growth profile, and Shell's Downstream strategy.”
Shell shares in London closed down 19 pence, almost 1% off on the day at 2101.00.  Although volume traded exceeded 3.3m the price closed static on the previous day.   
In a nut-Shell
What Shell is basically saying, and which is relevant to 90 000 square kilometres of the Great Karoo in this controversial shale-gas fracking bid, is that it has been selling assets for the past five years …and intends to continue to hive off in order to achieve large-scale growth as fossil fuel demand begins to outstrip supply. 
This means it has the money and it is focused on exploiting new oil and gas options. 
According to Reuters Africa, RDS CEO Peter Voser says “"We may face a situation at one stage where supply cannot meet demand."
Shell’s focus, aside from offloading select downstream activities to bolster coffers, is on finding more gas and oil to satisfy the increasing demands of fossil fuel reliance.   
Boardroom activism
In 2000, internationally renowned environmental activist agency, Greenpeace International, purchased 4 400 shares in Royal Dutch Shell. The intention was to influence fellow shareholders and overall decision, before and during an AGM.   
At the time Greenpeace stated its intention was to “… force the company [Shell] to build a large-scale solar panel factory”.
Royal Dutch Shell’s next AGM is on May 17 2011.
*Geraldine Bennett, a former high profile television anchor and energy sector executive, keeps an eye on environmental issues for Moneyweb. She can be reached via
Disclaimer:  Part of Bennett’s fuel is being sponsored by Craig Elstob; accommodation by Peet & Hannah van Heerden; Roland & Lizelle du Toit, and Dr Peter Baker.  The TKAG (Treasure the Karoo Action Group) donated R1 000 towards her costs of covering this series.


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