Communities Block Shell's Offshore Oil Plans in Landmark Court Victory

Communities Block Shell's Offshore Oil Plans in Landmark Court Victory

South African court halts Shell's offshore exploration after finding communities were excluded from decision-making

Sinegugu Zukulu, co-founder and director of Sustaining the Wild Coast, was emotional when the verdict came through. “We are feeling very emotional because this particular fight for us, this was not a personal fight. It was a fight for the health and for the well-being of the planet,” he said. After years of opposition to offshore oil and gas exploration plans, the communities he represents had won.

The Constitutional Court has set aside an exploration right held by Shell and Impact Africa off South Africa’s Wild Coast, finding that thousands of affected community members were systematically excluded from the decision-making process that originally granted the companies permission to explore. The judgment, delivered by Justice Jody Kollapen, goes far beyond the fate of one exploration right. It places the dispute within South Africa’s longer history of dispossession and the ongoing struggles of coastal communities to protect their land, marine resources and ways of life from extractive industries.

For Wild Coast residents, the ocean is not simply a source of food or income. It is central to ancestral practices, traditional healing and spiritual life. Kollapen acknowledged the long-standing struggles of these communities, referring specifically to resistance to proposed mining in Xolobeni and the importance of marine resources to customary practices and cultural identity in the Dwesa-Cwebe region. Environmental governance in coastal areas, he wrote, is often marked by deep contestation, in which the protection of ecological systems is inseparable from the protection of rights to dignity, culture and livelihood.

At the heart of the case was a fundamental question: could an unlawful consultation process be fixed years later through additional engagement? The court answered no. The exploration right was originally granted to Impact Africa in 2014 and subsequently renewed. Shell acquired a 50 percent participating interest in 2021. The high court had previously found both the grant and renewal decisions unlawful and procedurally unfair. The Supreme Court of Appeal upheld those findings but suspended the setting aside of the right pending a third renewal application, during which further public participation could take place. Communities and environmental organizations challenged that remedy, arguing that delayed consultation could not cure the original violation.

The court’s investigation into the original consultation process revealed serious failures. Impact Africa had not properly investigated who the affected parties actually were. Notices were published in newspapers inaccessible to affected communities and only in English and Afrikaans, despite the area being predominantly isiXhosa-speaking. Traditional leaders had told Impact’s consultants that broader community engagement was required, yet no steps were taken to act on that. Kollapen concluded that “in these circumstances, Impact could not reasonably have believed that meaningful consultation had occurred.”

The judgment articulated a deeper understanding of what consultation means. It is not simply about giving people an opportunity to express an opinion. Consultation is tied to the dignity and agency of affected communities and their status as participants in decisions affecting their land, culture and livelihoods. Thousands of community members had been excluded from the original process, and telling them more than a decade later that they could now be consulted would not cure that violation. “Requiring a consultation to be conducted now does not vindicate the right to be consulted at the outset and does not vindicate the infringement of the applicant communities’ right to dignity,” Kollapen said.

Meanwhile, the court rejected the idea that economic development and community rights could simply be placed on opposite sides of a scale. While job creation is a legitimate consideration, it cannot be assumed to be inherently beneficial without asking who would receive the jobs, how secure they would be and what social, ecological and cultural costs affected communities would bear. Zukulu connected this reasoning to a much longer history. “For so many centuries, we know that through colonialism, it has always been the norm for people to be pushed off their land in order to open the way for so-called economic growth and economic development,” he said.

Nonhle Mbuthuma, spokesperson for the Amadiba Crisis Committee, described the judgment as “a very clear victory for the ACC and the other Wild Coast communities and a serious defeat for Shell and Impact Africa.” She noted that while the ruling does not necessarily mean oil and gas exploration off the Wild Coast is permanently prohibited, “the existing route to the project has been closed.” The judgment’s principles concerning meaningful consultation, human dignity and the rights of affected communities could have implications far beyond this particular case.

The court rejected the Supreme Court of Appeal’s approach of sending the matter back for a further renewal process. The original exploration application and environmental management programme dated from 2013. Since then, the legal and factual landscape had changed significantly, including the proposed operations, environmental impacts, scientific knowledge and the applicants’ financial and technical capacity. A fresh and properly considered decision would require a new application, a fresh consultation process and a new environmental management programme. The court also found that allowing the old application to proceed could effectively sidestep the moratorium on new offshore applications made in the public interest.

The judgment does not permanently bar the companies from applying for an exploration right in future. Any future application would have to be assessed according to the legal and factual circumstances applicable at that time. Shell’s argument that it was an innocent party because it had not conducted the original consultation process was rejected. When Shell acquired its 50 percent interest, Kollapen said, it also took on responsibility for the legal vulnerabilities associated with Impact’s actions. Shell had continued to maintain that the consultation process had been “entirely reasonable,” a position the court rejected as reflecting a view that consultation was a secondary and procedural consideration that could be easily remedied.

The consultation failure was not the only defect. The high court had also found failures to properly consider relevant factors, including climate change, the Integrated Coastal Management Act and the precautionary principle. While Shell and Impact Africa said they had invested approximately R1.1 billion in the project, Kollapen said the Supreme Court of Appeal had given this expenditure too much weight. “Financial interests should not be unduly elevated to overrule other factors in the enquiry into what is just and equitable,” he said.

Melissa Groenink-Groves, an attorney and programme manager at Natural Justice, described the ruling as a “groundbreaking victory” that had “ultimately put people over profits” and confirmed that those complicit in an unlawful process could not gain an advantage from it. In a statement, Shell said it remained committed to “responsible offshore exploration, meaningful stakeholder engagement and environmental stewardship,” and noted that viable offshore resources could contribute to South Africa’s energy security. Two justices dissented on the remedy, arguing it would be just and equitable to allow a final three-year exploration period with fresh consultation, but the majority rejected that approach.

For Zukulu, the ruling was ultimately about something larger than one company’s drilling plans. It was, he said, about “the future, sustainability and the wellbeing of the planet.” Whether future applicants take that framing seriously when they approach Wild Coast communities remains the open question.

Q&A

What did the Constitutional Court find about the original consultation process for the exploration right?

The court found serious failures: Impact Africa did not properly identify affected parties, published notices only in newspapers inaccessible to communities and only in English and Afrikaans despite the area being predominantly isiXhosa-speaking, and ignored traditional leaders' advice to conduct broader community engagement.

Why did the court reject allowing a new consultation process to fix the original violation?

The court ruled that consultation is tied to the dignity and agency of affected communities as participants in decisions affecting their land, culture and livelihoods. Requiring consultation more than a decade later would not vindicate the right to be consulted at the outset or cure the infringement of communities' right to dignity.

What is the significance of this judgment beyond the Shell and Impact Africa case?

The judgment's principles concerning meaningful consultation, human dignity and the rights of affected communities could have implications far beyond this particular case, establishing that those complicit in an unlawful process cannot gain an advantage from it.

Can Shell and Impact Africa apply for an exploration right in the future?

The judgment does not permanently bar the companies from applying for an exploration right in future, but any new application would require a fresh consultation process, new environmental management programme and assessment according to legal and factual circumstances at that time.