Why South Africa needs to pursue the potential of gas from fracking

Abstract

Fracking has altered the global geopolitics of energy – probably for the better. North America is nearly independent of imported oil and is starting to export gas. It is therefore no surprise that the costs, benefits and risks are being hotly debated in South Africa.Less than five years ago there was talk that the US had hit peak oil. This meant that it would soon be so beholden to the Middle East for oil that the US dollar would plummet in value because the US balance of trade would be so adverse.As a consequence of oil and gas production from fracking, the US now has almost enough oil to be fully fuel independent. Other local energy supplies, such as coal, have also been replaced. There are a number of examples in the US where this has happened. About 60GW of coal-fired generation will be closed by 2020.But the process of fracturing rock by hydraulic pressure to uncover oil or gas carries risks. There are many fears about what could go wrong in fracking. Because of its high-pressure operations, the biggest fears relate to leaks and the consequences of leaks.Does fracking present a potential solution to South Africa’s energy crisis? Or are the risks too high?About 75% of South Africa’s energy supply comes from coal. This is very high and only a few countries in the world are this heavily dependent on coal. At present 94% of South Africa’s energy needs come from coal and oil. One-fifth of the country’s energy needs are met by oil. And gas makes up less than 1% of its needs. Renewable energy is starting to make a contribution, with the Department of Energy focusing on biomass, wind and solar energy.