The budget speeches just finished in parliament give a good...

The budget speeches just finished in parliament give a good guide as to what can be expected as far as shale development and CEL is concerned:

2014 Budget Vote speech by the Deputy Minister of Energy, Ms Thembisile Majola, MP Good Hope Chambers, Parliament, Cape Town:

'As part of the energy mix we remain resolute in our belief that the potential for shale gas in the Karoo basin needs to be exploited. This resource has the potential to create a new industry and associated skills. The need to ensure that this is exploited with great care to the environment cannot be over-emphasised.'

2014 Policy Budget Speech by the Minister of Energy Ms Tina Joemat-Pettersson, MP Good Hope Chambers, Parliament, Cape Town 21st July 2014:

'The development of shale gas cannot be dismissed or ignored. On the contrary, we should be learning from others on how to best exploit this resource in the least intrusive and environmentally prudent way. The United States anticipates complete independence from Middle Eastern crude oil by 2020, as a direct result of their development of shale gas reserves. Our government has adopted a cautious and responsible approach that seeks to understand the risks to the environment posed by fracking, and we will ensure, working with the Department of Environmental Affairs, that we implement this programme to the highest environmental standards and regulation.
I am happy to indicate that PetroSA has a dedicated focus on this resource, and has established a unit to ensure it is prepared for shale gas activities.'

Address by the Minister of Mineral Resources, Adv. Ngoako Ramatlhodi, MP, on the occasion of the Budget Vote 32: Mineral Resources National Assembly, Cape Town 15th July 2014:

'Since my appointment, a number of concerns have been received by me from stakeholders both in the mining and upstream petroleum industries on some issues contained in the MPRD Amendment Bill. I have been consulting on these issues and as a result, an Inter-Ministerial Committee has been established to comprehensively evaluate and accommodate concerns through the development of robust regulations in order to provide greater certainty and to encourage continued investment in the mining sector, to give practical effect to the MPRDA Amendment Bill. We undertake to continue to engage with and to address the concerns of stakeholders throughout this process of strengthening the regulatory framework during the course of this administration. '

'Having spent time listening to stakeholders, and taking cognizance of the fact that under our Constitution, a Bill before the President can be referred back to Parliament if it cannot muster a Constitutional test, I am ready for any eventuality. In the event the current Bill is assented to in its form, I commit to a rigorous and transparent engagement with stake holders, on draft regulations. ]

'With regard to upstream petroleum industry, our policy position is to enable an investor friendly environment, whilst securing vital state interests. Any legislation or agreement interim or long term has to conform to this formula.

' in the coming weeks we will launch a platform to debate draft regulations already developed, which may provide an interim solution to enable the significant investment required to take place while the long term foundation is being laid. This interim solution has the benefit that it will afford us the opportunity to explore long term and sustainable solutions that can then be incorporated into the overall process. The interim solution is critical now because it allows us to harness the opportunity to capture the scale of investment in this window of opportunity that is available to South Africa,'


What does this translate to(solely my opinion): Shale gas is to be developed as a matter of priority.The Government will ensure that it maintains its 20% free carry but will do so on terms that provide investor certainty ie; a specific formula and perhaps a cap on any increase in shareholding that will ensure investors (oil and gas companies)get their return.The minister has repeatedly said that clarifying the regulations is urgent so I would expect that within 3 months , the MPRDA regulations would have been cleared up , the fracking regulations issued(they are ready) and just maybe the exploration licenses will have been issued.You cant have the prime minister, minister of mineral resources and minister of energy all commenting on shale gas being a game changer and not follow through. Ad - nauseum it has been repeated that Cel has a large and prime acreage and recently from the MD that the farm - in partners have recognised the strategic importance of Cels acreage.With potential billions of revenue to come from Cels license it is a matter of time to quote the Australian that CEL goes boom !