About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2019
>>
[2019] ZASCA 99
|

|

Minister of Mineral Resources v Stern and Others; Treasure the Karoo Action Group and Another v Department of Mineral Resources and Others (1369/2017; 790/2018) [2019] ZASCA 99; [2019] 3 All SA 684 (SCA) (4 July 2019)

Links to summary

THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case
No: 1369/2017 and 790/2018
In
the matters between:
MINISTER
OF MINERAL
RESOURCES                                                          APPELLANT
and
JOHN
DOUGLAS STERN NO & 15 OTHERS
RESPONDENTS
and
TREASURE
THE KAROO ACTION GROUP                                       FIRST

APPELLANT
AFRIFORUM                                                                                    SECOND

APPELLANT
and
DEPARTMENT
OF MINERAL RESOURCES                                    FIRST

RESPONDENT
MINISTER
OF MINERAL RESOURCES                                      SECOND

RESPONDENT
THE
HEAD OF THE DEPARTMENT OF
MINERAL
RESOURCES                                                                   THIRD

RESPONDENT
MINISTER
OF ENVIRONMENTAL AFFAIRS                               FOURTH

RESPONDENT
Neutral
citation:
Minister
of Mineral Resources v Stern & others
(1369/2017)
and
Treasure
the Karoo Action Group & another v Department of Mineral
Resources & others
(790/2018)
[2019] ZASCA 99
(4 July 2019)
Coram:
Cachalia,
Mbha, Mathopo and Van der Merwe JJA and Davis AJA
Heard:
16 May
2019
Delivered:
4 July
2019
Summary:
Statute – whether
Minister of Mineral Resources empowered by
s 107(1)
of the
Mineral
and Petroleum Resources Development Act 28 of 2002
to make the
Regulations for Petroleum Exploration and Production, 2015 (the
Petroleum regulations) – Petroleum regulations
regulate process
and requirements of application for environmental authorisation under
the National Environmental Management Act
107 of 1998 (NEMA) and set
a regulatory framework and norms and standards for management of
environmental impacts of petroleum
exploration and production –
Minister of Environmental Affairs empowered by NEMA to make
regulations regarding these matters
– Minister of Mineral
Resources not empowered to make regulations regarding environmental
matters – impractical to
sever invalid regulations from the
Petroleum regulations – Petroleum regulations set aside in
their entirety.
ORDER
On
appeal from:
Eastern
Cape Division of the High Court, Grahamstown (Bloem J sitting as
court of first instance) (Stern matter) and Gauteng Division
of the
High Court, Pretoria (Dippenaar AJ sitting as court of first
instance) (TKAG matter):
In the Stern matter
:
1  The appeal is
dismissed with costs, including the costs of two counsel.
In the TKAG matter
:
1  The appeal is
upheld with costs, including the costs of two counsel.
2  The order of the
court a quo is set aside and replaced with the following:
‘
(a) The
Regulations for Petroleum Exploration and Production, 2015 that came
into effect on 3 June 2015, in accordance with Government
Notice R466
in Government Gazette 38855, are reviewed and set aside.
(b) The respondents,
jointly and severally, are ordered to pay the costs of this
application, including the costs of two counsel.’
JUDGMENT
Van
der Merwe JA (Cachalia, Mbha and Mathopo JJA and Davis AJA
concurring)
Introduction
[1]
On 3 June 2015, the Minister of Mineral Resources (the Minerals
Minister) promulgated the Regulations for Petroleum Exploration
and
Production, 2015 (the Petroleum regulations).
[1]
Whether the Minerals Minister was empowered to make these
regulations, is the central issue in this consolidated appeal.
[2]
On 20 November 2015, the trustees of the Stern Family Trust and
several other farmers and farmers’ organisations launched
an
application in the Eastern Cape Division of the High Court,
Grahamstown for an order reviewing and setting aside the Petroleum

regulations (the Stern matter). All of the applicants in the Stern
matter have interests in farming in the Karoo districts of
Graaff-Reinet, Cradock and Jansenville. The Minerals Minister was
cited as the only respondent. Several grounds for review were
raised,
but by the time that the matter came before Bloem J, only two
remained. They were whether the Minerals Minister had the
power to
make the Petroleum regulations and whether their making was
procedurally fair. The applicants relied on the provisions
of the
Promotion of Administrative Justice Act 3 of 2000 (PAJA) and in the
alternative, on the constitutional principle of legality.
The
Minerals Minister argued that necessary parties had not been joined
in the application. He admitted that PAJA was applicable,
but
maintained that the Petroleum regulations were validly made under s
107 of the Mineral and Petroleum Resources Development
Act 28 of 2002
(the MPRDA). He denied that an unfair procedure had been employed.
[3]
Bloem J rejected the non-joinder plea. He also held that the Minerals
Minister was not empowered to make the Petroleum regulations,
and
that their making was procedurally unfair. He thus granted an order
reviewing and setting them aside in terms of ss 6(2)
(a)
(i)
and 6(2)
(c)
of PAJA, with costs, but granted leave to the Minerals Minister to
appeal to this court. The issues in the appeal relating to the
Stern
matter are the same as those determined by Bloem J, save that the
Minerals Minister contended in this court that PAJA did
not apply to
the making of the Petroleum regulations.
[4]
On 27 November 2015, some seven days after the commencement of the
Stern matter, two non-profit organisations, Treasure the
Karoo Action
Group and AfriForum, launched a similar application in the Gauteng
Division of the High Court, Pretoria (the TKAG
matter). The first
three respondents in the TKAG matter were the Minerals Minister, the
Department of Mineral Resources and the
Head of the Department of
Mineral Resources. Unless the context indicates otherwise, I refer to
these three respondents collectively
as the Minerals Minister. The
fourth respondent was the Minister of Environmental Affairs (the
Environment Minister). The applicants
in the TKAG matter sought the
review and setting aside of the Petroleum regulations on various
grounds. The matter was opposed
by the Minerals Minister and the
Environment Minister. It came before Dippenaar AJ, who found for the
respondents and dismissed
the application, but directed that each
party pay its own costs. She also granted leave to appeal to this
court. The sole issue
in the appeal relating to the TKAG matter is
whether the Petroleum regulations fall foul of the principle of
legality.
Hydraulic
fracturing and the environment
[5]
During the 1960s and 1970s gas reserves were discovered in the
sedimentary shale rock structures in the Karoo Basin. These shale

rock structures are found at depths of between 1 500 metres and 4 500
metres below the surface. Hydrocarbon gas that had been created
from
organic material, escaped from source rock formations, migrated
upwards and became trapped in small porous spaces in the extremely

impermeable shale rock structures. This is referred to as shale gas.
There is no real distinction between the nature of shale gas
and that
of conventional oil and gas deposits. The critical difference lies in
the method of their extraction. Hydrocarbon accumulations
in
reservoir rocks form conventional oil and gas fields from which the
oil or gas is extracted by drilling wells that give access
to the
reservoirs. Because the small pore spaces containing the shale gas
are dispersed over very large areas, the shale gas cannot

economically be accessed and extracted by conventional methods. The
method of extracting shale gas relevant to this appeal is hydraulic

fracturing or ‘fracking’.
[6]
In the Karoo Basin, hydraulic fracturing for shale gas would firstly
involve deep vertical drilling into the shale rock layer.
The
drilling would intersect various geological layers. This may cause
the linking of multiple isolated hydrogeological systems.
Once the
shale rock layer is reached, horizontal drilling takes place for up
to 2 500 metres. The purpose of the horizontal drilling
is to
maximise contact with the shale gas pores in the layer. The contact
between the drilled wells and the pores must, however,
be enhanced
artificially. This is done by pumping a mixture of water (99 to 99,5
per cent) and chemicals (0,5 to 1 per cent) into
the well at high
pressure. This process fractures the shale rock layer. The
overpressurised water opens the fractures to gain access
to as many
pores as possible. Once the pressure is reduced, the water, mixed
with heavy or radioactive metals from the rock formation,
reflows to
the surface, together with the shale gas.
[2]
[7]
Hydraulic fracturing may have a variety of adverse effects on the
environment. Because the small shale gas pores are spread
over a wide
area, production of shale gas by hydraulic fracturing in economically
viable quantities requires more wells than conventional
gas fields.
This would unavoidably result in area consumption for drilling pads,
equipment, and facilities for processing, storing
and transporting
the gas. Access roads and manoeuvring space for trucks would be
required. This would generate dust and noise.
Hydraulic fracturing
may also have seismic effects. Large quantities of water would be
used. Waste water containing chemicals or
heavy or radioactive metals
would have to be disposed of.
[8]
It is common cause, however, that the major potentially adverse
impacts of hydraulic fracturing on the environment are the emission

of pollutants and the contamination of surface water and groundwater.
This may be caused by uncontrolled gas or fluid flows arising
from
blowouts or spills, linking of hydrogeological systems, well failures
(corrosion of the casing or cementing failure), leaking
of fracturing
fluids and uncontrolled waste water discharge. The contamination of
groundwater in a water-scarce area may, in particular,
be disastrous.
Factual
Background
[9]
The definition of ‘petroleum’ in s 1 of the MPRDA
includes hydrocarbon gas such as shale gas. Chapter 6 of the MPRDA

(ss 69-90) deals with the exploration for and production of
petroleum. An application for an exploration right is made in terms

of s 79 of the MPRDA. It is made to the Petroleum Agency of South
Africa (PASA), an agency designated under s 70 to perform functions

referred to in Chapter 6, and is considered by the Minerals Minister
in terms of s 80 of the MPRDA. An application for a production
right
is submitted to PASA in terms of s 83 and considered by the Minerals
Minister under s 84.
[10]
Between 2008 and 2010 three companies applied to PASA for rights to
explore for shale gas in the Karoo by the use of hydraulic

fracturing. They are Bundu Gas and Oil Exploration (Pty) Limited
(Bundu), Falcon Oil and Gas Ltd (Falcon) and Shell Exploration

Company B.V. (Shell). The public participation processes that
followed elicited a large number of objections to these applications.

The objections were aimed, essentially, at the potentially adverse
environmental impacts of hydraulic fracturing and the lack of
proper
regulation thereof.
[11]
In response to these objections, and on the recommendation of PASA,
the Minerals Minister imposed a moratorium on all applications
for
rights under Chapter 6 of the MPRDA. The moratorium was imposed in
terms of s 49(1) of the MPRDA and published in the Government
Gazette
on 1 February 2011,
[3]
but did
not affect the applications received before this date from Bundu,
Falcon and Shell.
[12]
During December 2011, the Minerals Minister established an
inter-departmental task team. Its mandate included the evaluation
of
the potential environmental risks posed by the process of hydraulic
fracturing as well as the social impacts of shale gas exploitation.

The task team appointed a working group to perform a study in this
regard, which it duly produced, and the task team submitted
a report
to the Minerals Minister.
[13]
The report of the task team included the following recommendations:
(a) to allow normal exploration (excluding hydraulic fracturing),

such as geological field mapping and other data-gathering activities
to proceed under the existing regulatory framework; (b) to
constitute
a monitoring committee to ensure comprehensive and coordinated
augmentation of the regulatory framework and supervision
of
operations; (c) to augment the current regulatory framework; and (d)
once all the preceding actions have been completed, to
authorise
hydraulic fracturing under strict supervision of the monitoring
committee, which, in the event of any unacceptable outcomes,
could
halt the process.
[14]
On 7 September 2012, Cabinet approved these recommendations. The
envisaged monitoring committee was established. Amongst its
members
were representatives of the Departments of Mineral Resources,
Environmental Affairs, Water and Sanitation, and Science
and
Technology. The monitoring committee produced draft regulations,
which were published by the Minerals Minister for public comment
on
October 2013.
[4]
The
monitoring committee assessed the responses and revised the
regulations.
[15]
In the meantime, the Minerals Minister published another moratorium
under s 49(1) of the MPRDA.
[5]
The moratorium again excluded the applications of Bundu, Falcon and
Shell. However, on 24 November 2014, these entities were informed

that PASA would process their applications, but that they should:
revise their environmental management programmes to exclude hydraulic

fracturing; undertake a further public participation process in terms
of s 79(4)
(a)
of the MPRDA in respect of their revised environmental management
programmes; and submit their revised environmental management

programmes by 27 February 2015. Bundu and Falcon availed themselves
of this opportunity, but Shell did not. The public participation

process in respect of the revised environmental management programmes
again elicited a large number of objections.
[16]
As I have said, the Minerals Minister promulgated the Petroleum
regulations on 3 June 2015. The Government Notice stated that
the
regulations were made under s 107 of the MPRDA.
[6]
There is no evidence that the applications of Bundu, Falcon and Shell
progressed beyond the stages that I have mentioned.
It can safely be
accepted that their progress was halted pending the outcome of the
appeal.
Legislative
history and framework
(a)
MPRDA
[17]
Section 3(1) of the MPRDA provides that mineral and petroleum
resources are the common heritage of all the people of South
Africa
and that the State is the custodian thereof for the benefit of all
South Africans. In terms of s 3(2), the Minerals Minister,
acting on
behalf of the State as custodian of the nation’s mineral and
petroleum resources, may grant, issue, refuse, control
and manage,
inter
alia
,
any prospecting right, mining right, exploration right or production
right. Chapter 4 of the MPRDA (ss 9-56) deals with applications
for
and granting of prospecting rights and mining rights in respect of
minerals. As I have said, Chapter 6 of the MPRDA deals with

applications for and granting of exploration rights and production
rights in respect of petroleum.
[7]
Section 69(2) makes certain provisions of the MPRDA relating to
minerals applicable to petroleum exploration and production.
[8]
[18]
Prior to the amendments that I shall revert to shortly, the
environmental impacts of petroleum exploration and production were

regulated under the MPRDA. Prior to its repeal, s 38 of the MPRDA,
inter
alia
,
provided that the holder of the relevant right under the MPRDA was
obliged to give effect to the general objectives of integrated

environmental management laid down in Chapter 5 of the National
Environmental Management Act 107 of 1998 (NEMA) and to consider,

investigate, assess and communicate the impact of the conduct in
terms of the right on the environment. It also provided that the

holder of the right: was obliged to manage all environmental impacts
in accordance with his or her environmental management plan
or
environmental management programme and as an integral part of his or
her operations; had, as far as it was reasonably practicable,
to
rehabilitate the environment affected by the operations to its
natural or predetermined state; and was responsible for any
environmental damage, pollution or ecological degradation as a result
of his or her operations.
[19]
Section 39, in turn, provided for environmental management programmes
and environmental management plans, in the following
terms:
‘
(1)
Every person who has applied for a mining right in terms of section
22 must conduct an environmental impact assessment
and submit an
environmental management programme within 180 days of the date on
which he or she is notified by the Regional Manager
to do so.
(2)
Any person who applies for a reconnaissance permission, prospecting
right or mining permit must submit an environmental management
plan
as prescribed.
(3)
An applicant who prepares an environmental management programme or an
environmental management plan must—
(a)
establish
baseline information concerning the affected environment to determine
protection, remedial measures and environmental
management
objectives;
(b)
investigate,
assess and evaluate the impact of his or her proposed prospecting or
mining operations on—
(i)
the environment,
(ii)
the socio-economic conditions of any person who might be directly
affected by the prospecting or mining operation; and
(iii)
any national estate referred to in section 3 (2) of the
National Heritage Resources Act, 1999 (Act No. 25 of 1999),
with the
exception of the national estate contemplated in section 3 (2) (
i
)
(vi) and (vii) of that Act;
(
c
)
develop an environmental awareness plan describing the manner in
which the applicant intends to inform his or her employees of
any
environmental risks which may result from their work and the manner
in which the risks must be dealt with in order to avoid
pollution or
the degradation of the environment; and
(
d
)
describe the manner in which he or she intends to—
(i)
modify, remedy, control or stop any action, activity or process which
causes pollution or environmental degradation;
(ii)
contain or remedy the cause of pollution or degradation and migration
of pollutants; and
(iii)
comply with any prescribed waste standard or management standards or
practises.
(4)
(
a
) Subject to paragraph (
b
), the Minister must, within
120 days from the lodgement of the environmental management programme
or the environmental management
plan, approve the same, if—
(i)
it complies with the requirements of subsection (3);
(ii)
the applicant has complied with section 41 (1); and
(iii)
the applicant has the capacity, or has provided for the capacity, to
rehabilitate and manage negative impacts on the environment.
(
b
)
The Minister may not approve the environmental management programme
or the environmental management plan unless he or she has
considered—
(i)
any recommendation by the Regional Mining Development and
Environmental Committee; and
(ii)
the comments of any State department charged with the administration
of any law which
relates to matters affecting the
environment.
(5)
The Minister may call for additional information from the person
contemplated in subsection (1) or (2) and may direct that the

environmental management programme or environmental management plan
in question be adjusted in such way as the Minister may require.
(6)
(
a
) The Minister may at any time after he or she has approved
an environmental management programme or environmental management
plan
and after consultation with the holder of the reconnaissance
permission, prospecting right, mining right or mining permit
concerned,
approve an amended environmental management plan or
environmental management programme;
(
b
)
For the purposes of paragraph (
a
),
subsection (4) applies with the necessary changes.
(7)
The provisions of subsection (3) (
b
)
(ii) and the subsection (3) (
c
)
do not apply to the applications for reconnaissance permissions,
prospecting rights or mining permits.’
[20]
Prior to its amendment, s 107(1) of the MPRDA read as follows:
‘
(1)
The Minister may, by notice in the
Gazette
,
make regulations regarding—
(
a
)
(i) the conservation of the environment at or in the vicinity of any
mine or works;
(ii)
the management of the impact of any mining operations on the
environment at or in the vicinity of any mine or works;
(iii)
the rehabilitation of disturbances of the surface of land where such
disturbances are connected to prospecting or mining operations;
(iv)
the prevention, control and combating of pollution of the air, land,
sea or other water, including ground water, where such
pollution is
connected to prospecting or mining operations;
(v)
pecuniary provision by the holder of any right, permit or permission
for the carrying out of an environmental management programme;
(vi)
the establishment of accounts in connection with the carrying out of
an environmental management programme and the control
of such
accounts by the Department;
(vii)
the assumption by the State of responsibility or co-responsibility
for obligations originating from regulations made under
subparagraphs
(i), (ii), (iii) and (iv) of this paragraph; and
(viii)
the monitoring and auditing of environmental management programmes;
(
b
)
the exploitation processing, utilization or use of or the disposal of
any mineral;
(
c
)
procedures in respect of appeals lodged under this Act;
(
d
)
fees payable in relation to any right, permit or permission issued or
granted in terms of this Act;
(
e
)
fees payable in relation to any appeal contemplated in this Act;
(
f
)
the form of any application which may or have to be done in terms of
this Act and of any consent or document required to be submitted
with
such application, and the information or details which must accompany
any such application;
(
g
)
the form, conditions, issuing, renewal, abandonment, suspension or
cancellation of any environmental management programme, permit,

licence, certificate, permission, receipt or other document which may
or have to be issued, granted, approved, required or renewed
in terms
of this Act;
(
h
)
the form of any register, record, notice, sketch plan or information
which may or shall be kept, given, published or submitted
in terms of
or for the purposes of this Act;
(
i
)
the prohibition on the disposal of any mineral or the use thereof for
any specified purpose or in any specified manner or for
any other
purpose or in any other manner than a specified purpose or manner;
(
j
)
the restriction or regulation in respect of the disposal or use of
any mineral in general;
(
k
)
any matter which may or must be prescribed for in terms of this Act;
and
(
l
)
any other matter the regulation of which may be necessary or
expedient in order to achieve the objects of this Act.’
[21]
An agreement entered into between the Environment Minister, the
Minerals Minister and the Minister responsible for water affairs,

constituted a paradigm shift in respect of the management of
environmental impacts of activities under the MPRDA. The agreement

was entitled the
One Environmental System.
Its main import is
set out in s 50A(2) of NEMA:
‘
Agreement
for the purpose of
subsection
(1)
means
the Agreement reached between the Minister, the Minister responsible
for water affairs and the Minister responsible for mineral
resources
titled
One
Environmental System
for
the country with respect to mining, which entails—
(
a
)
that all environment related aspects would be regulated through one
environmental system which is the principal Act and that all

environmental provisions would be repealed from the
Mineral and
Petroleum Resources Development Act, 2002
;
(
b
)
that the Minister sets the regulatory framework and norms and
standards, and that the Minister responsible for Mineral Resources

will implement the provisions of the principal Act and the
subordinate legislation as far as it relates to prospecting,
exploration,
mining or operations;
(
c
)
that the Minister responsible for Mineral Resources will issue
environmental authorisations in terms of the principal Act for

prospecting, exploration, mining or operations, and that the Minister
will be the appeal authority for these authorisations; and
(
d
)
that the Minister, the Minister responsible for Mineral Resources and
the Minister responsible for Water Affairs agree on fixed
time-frames
for the consideration and issuing of the authorisations in their
respective legislation and agree to synchronise the
time frames.’
[9]
Thus,
the implementation of the
One
Environmental System
would establish NEMA as the only environmental statute and the
Environment Minister as the ‘lead’ minister.
[22]
Pursuant to the
One Environmental System
, ss 38, 39 and
107(1)
(a)
of the MPRDA, amongst others, were deleted with
effect from 7 June 2013 and s 38A was inserted in the MPRDA. It
provides:
‘
(1) The
Minister is the responsible authority for implementing environmental
provisions in terms of the
National Environmental Management Act,
1998
(
Act No. 107 of 1998
)
as it relates to prospecting, mining, exploration, production or
activities incidental thereto on a prospecting, mining, exploration

or production area.
(2) An
environmental authorisation issued by the Minister shall be a
condition prior to the issuing of a permit or the granting
of a right
in terms of this Act.’
In
terms of s 1 of the MPRDA, ‘environmental authorisation’
has the meaning assigned to it in s 1 of NEMA.
(b)
NEMA and the EIA regulations
[23]
Section 1 of NEMA defines the ‘environment’ as ‘the
surroundings within which humans exist and that are made
up of –
(i) the land, water and atmosphere of the earth; (ii)
micro-organisms, plant and animal life; (iii) any part or combination

of (i) and (ii) and the interrelationship among and between them; and
(iv) the physical, chemical, aesthetic and cultural properties
and
conditions of the foregoing that influence human health and
well-being’. It also defines ‘environmental
authorisation’.
For present purposes this means the
authorisation by a competent authority of a listed activity. A listed
activity is an activity
identified by the Environment Minister under
s 24(2)
(a)
,
which may not commence without an environmental authorisation from
the competent authority. The exploration for and production
of
petroleum are such listed activities. The competent authority is the
organ of state charged by NEMA with granting or refusing
an
environmental authorisation in respect of a specific listed activity,
in casu
the Minerals Minister.
[24]
Chapter 5 of NEMA (ss 23-24K) deals with integrated environmental
management. Section 23 sets out the purpose and general objective
of
general integrated environmental management. Section 24 was
substituted in consequence of the
One
Environmental System
.
It deals extensively with environmental authorisations. In terms of s
24(1A), an applicant for an environmental authorisation
must comply
with the requirements prescribed
[10]
in terms of NEMA, including the regulations issued thereunder,
[11]
in relation to:
‘
(
a
)
steps to be taken before submitting an application, where applicable;
(
b
) any
prescribed report;
(
c
) any
procedure relating to public consultation and information gathering;
(
d
) any
environmental management programme;
(
e
) the
submission of an application for an environmental authorisation and
any other relevant information; and
(
f
)
the undertaking of any specialist report, where applicable.’
[25]
Section 24(4) of NEMA details what procedures for the investigation,
assessment and communication of the potential consequences
or impacts
of activities on the environment must include and ensure. Section
24(5) provides that the Environment Minister, or a
MEC to whom the
relevant Premier has assigned responsibility for environmental
affairs with the concurrence of the Environment
Minister, may make
regulations consistent with s 24(4):
‘
(
a
)
laying down the procedure to be followed in applying for, the issuing
of, and monitoring compliance with, environmental authorisations;
(
b
)
laying down the procedure to be followed in respect of—
(i)
the efficient administration and processing of environmental
authorisations;
(ii)
fair decision-making and conflict management in the consideration and
processing of applications for environmental authorisations;
(iv)
applications to the competent authority by any person to be exempted
from the provisions of any regulation in respect of a
specific
activity;
(Editorial note:
Numbering as per
Government Gazette
.)
(v)
appeals against decisions of competent authorities;
(vi)
the management and control of residue stockpiles and deposits;
(vii)
consultation with land owners, lawful occupiers and other interested
or affected parties;
(viii)
mine closure requirements and procedures, the apportionment of
liability for mine closure and the sustainable closure of
mines with
an interconnected or integrated impact resulting in a cumulative
impact;
(ix)
financial provision; and
(x)
monitoring and environmental management programme performance
assessments;
(
b
A)
laying down the procedure to be followed for the preparation,
evaluation, adoption and review of prescribed environmental
management
instruments, including—
(i)
environmental
management frameworks;
(ii)
strategic
environmental assessments;
(iii)
environmental
impact assessments;
(iv)
environmental management programmes;
(v)
environmental risk assessments;
(vi)
environmental feasibility assessments;
(vii)
norms or standards;
(viii)
spatial development tools;
(viiiA)
minimum information requirements; or
(ix)
any other relevant environmental management instrument that may be
developed in time;
. . . .
(
h
)
prescribing minimum criteria for the report content for each type of
report and for each process that is contemplated in terms
of the
regulations in order to ensure a consistent quality and to facilitate
efficient evaluation of reports;
(
i
)
prescribing review mechanisms and procedures including criteria for,
and responsibilities of all parties in, the review process;
and
(
j
)
prescribing any other matter necessary for dealing with and
evaluating applications for environmental authorisations.’
[26]
It is also necessary to refer to s 24(10) of NEMA. It provides:
‘
(
a
)
The Minister, or an MEC with the concurrence of the Minister, may—
(i)
develop or adopt norms or standards for—
(
aa
)
a listed activity or specified activity contemplated in
subsection
(2) (
a
)
and
(
b
)
;
(
bb
)
any part of the listed or specified activity referred to in
item
(
aa
)
;
(
cc
)
any sector relating to
item
(
aa
)
;
(
dd
)
any geographical area relating to
item
(
aa
)
;
or
(
ee
)
any combination of the activities, sectors, geographical areas,
listed activities or specified activities referred to in
items
(
aa
)
,
(
bb
)
,
(
cc
)
and
(
dd
)
;
(ii)
prescribe the use of the developed or adopted norms or standards in
order to meet the requirements of this Act;
(iii)
prescribe reporting and monitoring requirements; and
(iv)
prescribe procedures and criteria to be used by the competent
authority for the monitoring of such activities in order to determine

compliance with the prescribed norms or standards.
(
b
)
Norms or standards contemplated in
paragraph
(
a
)
must
provide for rules, guidelines or characteristics—
(i)
that may commonly and repeatedly be used; and
(ii)
against which the performance of activities or the results of those
activities may be measured for the purposes of achieving
the objects
of this Act.
(
c
)
The process of developing norms or standards contemplated
in
paragraph
(
a
)
must,
as a minimum, include—
(i)
publication of the draft norms or standards for comment in the
relevant
Gazette
;
(ii)
consideration of comments received; and
(iii)
publication of the norms or standards to be prescribed.
(
d
)
The process of adopting norms or standards contemplated in
paragraph
(
a
)
must,
as a minimum, include—
(i)
publication of the intention to adopt existing norms or standards in
order to meet the requirements of this Act for comment
in the
relevant
Gazette
;
(ii)
consideration of comments received; and
(iii)
publication of the norms or standards to be prescribed.’
[27]
Section 44(1) provides,
inter alia
, that the Environment
Minister may make regulations prohibiting, restricting or controlling
activities which are likely to have
a detrimental effect on the
environment and generally, to carry out the purposes and the
provisions of NEMA. Section 44(1C) reads:
‘
Regulations made in terms of
this Act or any other Act of Parliament that may have the effect of
amending the provisions of the
Agreement referred to in section 50A
must be made by the Minister in concurrence with the Minister
responsible for mineral resources
and the Minister responsible for
water affairs.’
[28]
The Environment Minister has not, as yet, made regulations
specifically in terms of s 44(1), nor has she developed or adopted

norms and standards in terms of s 24(10) of NEMA. The Environment
Minister did, however, make regulations as envisaged by  s
24(5)
of NEMA. They are the
Environmental Impact Assessment Regulations,
2014
, as amended (the EIA regulations).
[12]
The EIA regulations prescribe procedures and requirements for
applications for: an environmental authorisation; amendment of an

environmental authorisation; amendment of an environmental management
programme (EMPr); and amendment of a closure plan. In terms
of reg 15
an environmental assessment practitioner must identify whether basic
assessment or a scoping and environmental impact
reporting process (S
& EIR) must be applied to a particular application.
[29]
Chapter 4 of the EIA regulations deals with applications for
environmental authorisation.
Regulation 16
prescribes general
requirements for such an application. Where basic assessment must be
applied to an application, reg 19 prescribes
what must be submitted
to the competent authority. Essentially these are a basic assessment
report, inclusive of specialist reports,
an EMPr and, where
applicable, a closure plan. When an S & EIR must be applied to
the application, the applicant for an environmental
authorisation
must submit a scoping report to the competent authority. If the
scoping report is accepted by the competent authority
in terms of reg
22, the applicant must submit an environmental impact report
inclusive of specialists’ reports and an EMPr.
Each of these
reports, programmes and plans must contain the detailed information
relating to environmental risks and impacts that
are set out in a
dedicated appendix to the EIA regulations and must have been
subjected to a public participation process.
Regulation-making
powers in respect of environmental matters
[30]
As I have shown, the
One Environmental System
envisaged that
all environmental aspects relating to prospecting, exploration,
mining or production in terms of the MPRDA would
be regulated through
NEMA and its subordinate legislation. It is plain that this includes
making regulations regarding the management
of the environmental
impacts of these activities.
Section 50A(2)
(b)
of NEMA
expressly provides that the Environment Minister would set the
regulatory framework and norms and standards in this regard.
A
meaning must be ascribed to the deliberate repeal of
s 107(1)
(a)
of the MPRDA in consequence of the
One Environmental System
.
The only meaning that presents itself is that its purpose was to
divest the Minerals Minister of the power to make any regulations

regarding the matters specified in
s 107(1)
(a)
(i)-(viii). It
bears repeating that what was thus taken away from the Minerals
Minister,
inter alia
, was the power to make regulations
regarding:
‘
(i)
the conservation of the environment at or in the vicinity of any mine
or works;
(ii)
the management of the impact of any mining operations on the
environment at or in the vicinity of any mine or works;
(iii) the
rehabilitation of disturbances of the surface of land where such
disturbances are connected to prospecting or mining operations;
(iv) the
prevention, control and combating of pollution of the air, land, sea
or other water, including ground water, where such
pollution is
connected to prospecting or mining operations;
. . . .
(viii) the
monitoring and auditing of environmental management programmes.’
[31]
As a result, the only regulation-making powers regarding the
environmental impacts of these activities, are those vested in
the
Environment Minister in terms of NEMA. As I have said, these powers
include: to identify a listed activity under
s 24(2)
; to make
regulations in terms of
s 44(1)
to carry out the purposes and
provisions of NEMA; to make regulations under
s 24(1A)
and
s 24(5)
laying down procedures and requirements for an application for an
environmental authorisation; and to develop or adopt norms and

standards in terms of
s 24(10)
in respect of,
inter
alia
, a
listed activity. Therefore it is clear that the Minerals Minister has
no power to make regulations relating to the management
of the
environmental impacts of exploration or production of petroleum or
the process and requirements of an application for an
environmental
authorisation. All of this is entirely consonant with what the
One
Environmental System
aimed
to achieve, as stipulated in
s 50A(2)
(b)
of NEMA.
[32]
The regulation-making powers of the Minerals Minister are, therefore,
limited to those set out in
s 107(1)
(b)
-
(l)
of the
MPRDA. The next question is whether all or some of the Petroleum
regulations were authorised by one or more of these provisions.
To
answer this question we must analyse the Petroleum regulations.
Environmental
Provisions of the Petroleum regulations
[33]
In terms of GN R466, the Minerals Minister ‘made the
regulations as arranged in the Schedule’. The Schedule stated,

however, that regulations previously made by the Minerals
Minister
[13]
are amended by
the addition of
Part IV
, headed ‘Petroleum Exploration and
Production’.
Part IV
contains Chapters 6-10 and regs 84-133.
Regulation 133
provides: ‘These regulations are called the
Regulations for Petroleum Exploration and Production, 2015.’
The Minerals
Minister correctly conceded that this peculiarity does
not prevent the review of the Petroleum regulations on their own.
[34]
The heading of Chapter 6 (regs 84-85) is ‘General Provisions’.
Chapter 7 (regs 86-93) is entitled ‘Environmental
Impact
Assessment’. Chapter 8 (regs 94-107) is entitled ‘Well
Design and Construction’. The regulations define
‘well’
as a drilled hole used for the purpose of exploration and production
of petroleum resources. The title of Chapter
9 (regs 108-129) is
‘Operations and Management’ and that of Chapter 10
(regs 130-133) is ‘Well Suspension
and
Decommissioning’.
[35]
A large number of provisions of the Petroleum regulations plainly
seek to manage the potential impacts of petroleum exploration
and
production on the environment. By way of example I refer to the
following:
[14]
(a)
Regulation 88(1)
, which requires an applicant for an exploration
right or a production right or a holder of an exploration right or a
production
right to appoint an independent specialist to conduct a
hydrocensus to indicate potentially affected water resources within
at
least a three kilometre radius from the furthest point of
potential horizontal drilling and identify priority water source
areas
and domestic groundwater supplies on relevant geohydraulical
maps;
(b)
Regulations 89(1)
-(2), which require such an applicant or holder,
prior to conducting hydraulic fracturing, to:
(i)
assess the risk of potential hydraulic fracturing related
seismicity;
(ii)
submit a risk assessment report and proposed mitigation measures for
approval and recommendation by the Council of Geoscience;
and
(iii)
to carry out site-specific surveys to characterise local stress
regimes and identify proximal faults and site characterisations;
(c)
Regulation 91
, which requires such a holder to prevent the
contamination of the environment by providing a suitably impermeable
site underlay
system and by making site drainage arrangements;
(d)
Regulation 94(2)
, which requires such an applicant or holder to
ensure that the list of specified design and operational risks are
considered as
part of a well-related risk assessment process,
including aquifer isolation, the protection of potable groundwater,
the containment
of fracturing and the deformation of aquifers and
geological strata due to injection or extraction of fluids or gas;
(e)
Regulation 95(1)
, which requires that the well design be informed by
a well-related risk assessment and that the well is constructed,
commissioned,
operated, modified, maintained, suspended and
decommissioned in a manner that provides for the control of the well
at all times,
and prevents:
(i)
the migration of petroleum and other fluids into any other formation
except the target formation;
(ii)
the pollution of water resources; and
(iii)
risks to health and safety of persons from the well or anything in
the well or in strata to which the well is connected;
(f)
Regulation 97
, which requires conductor casing to be set and cemented
to a surface in order to:
(i)
stabilise unconsolidated sediments;
(ii)
isolate shallow aquifers that provide or are capable of providing
fresh groundwater for water wells and springs in the vicinity
of the
well; and
(iii)
provide a base for equipment to divert shallow natural gas;
(g)
Regulation 99(1)
, which requires intermediate casing for exploration
and productions wells to be set to protect unexpected fresh water
found below
the surface casing shoe;
(h)
Regulation 102(11)
, which requires a holder of an exploration right
or a production right to ensure that there is isolation of hydraulic
fracturing
operations from fresh water and other permeable horizons
by ensuring complete cement isolation in each casing annulus;
(i)
Regulation 113(1)
, which provides that the substances listed in
Schedule I to the Petroleum regulations are prohibited from use in
the fracturing
process;
(j)
Regulation 114(2)
, which requires the researching, assessment and
documenting of faults and igneous intrusions that may impact on the
hydraulic fracturing
seal mechanism, in order to demonstrate that the
risk of fracturing fluids migrating via faults and intrusions beyond
the designated
fracture zones, has been mitigated;
(k)
Regulation 115(3)
(a)
, which requires that where technically
feasible, the holder of an exploration right or a production right
maximise the use of environmentally
friendly hydraulic fracturing
fluid additives and minimise the amount and number of additives;
(l)
Regulation 116(1)
, which requires the holder of an exploration right
or a production right to manage hydraulic fracturing flowback and
produced fluids
in accordance with an approved waste management plan;
(m)
Regulation 117(1)
, which requires an applicant for an exploration
right or a production right or the holder of an exploration right or
a production
right to develop a fluid transportation management plan
and specifies the requirements for such a plan;
(n)
Regulation 118(8)
(a)
, which requires that the background level
of radioactivity in the ground adjacent to the fluid storage tanks be
measured prior
to drilling and prior to site restoration, to
establish whether there has been any change that may require
particular remediation
measures;
(o)
Regulation 119(4)
(a)
, which requires an applicant for an
exploration right or a production right or a holder of an exploration
right or a production
right to ensure that risk assessments to
eliminate  or reduce the risks of dangerous substances being
released and the impact
of the release on the environment, is carried
out;
(p)
Regulation 121(1)
, which requires a holder of an exploration right or
a production right in control of operations to compile a water
balance that,
inter alia
:
(i)
accounts for and reflects the possible interconnections between the
operations, the surface and groundwater resource and how
these may be
avoided and mitigated; and
(ii)
is used by the holder to generate water management reports to assist
in the management of the impact of the operations on the
water
resource;
(q)
Regulation 122(1)
, which requires a holder of an exploration right or
a production right to ensure, prior to and during all the phases of
drilling
and hydraulic fracturing operations, that the operation does
not pollute a water resource or reduce such a resource and that where

such an incident occurs, the necessary remedial measures are
implemented;
(r)
Regulations 122(2)
and (3), which specify the minimum separation
distances between, on the one hand, a well site where hydraulic
fracturing operations
are proposed or planned and any directional
drilling from such site and, on the other hand, any existing or
identified future municipal
water well field, any existing water
borehole, the edge of a riparian area, the 100-year flood line of a
water course and a wetland;
(s)
Regulation 124(4)
, which prohibits the disposal of waste to
underground, including the use of re-injection disposal wells;
(t)
Regulation 124(5)
, which prohibits the discharge of hydraulic
fracturing fluids, hydraulic fracturing flowback and produced water
into a surface
watercourse;
(u)
Regulation 127(1)
, which requires the holder of en exploration right
or a production right to minimise the emissions associated with the
venting
of hydrocarbon fluids and natural gas during the hydraulic
fracturing operations and specifies the technical manner in which it

must do so;
(v)
Regulation 128(2)
, which requires the holder of an exploration right
or a production right to employ practises for the control of fugitive
dust during
the hydraulic fracturing operations and specifies the
minimum such practises; and
(w)
Regulation 129(1)
, which requires that site selection and the
identification of traffic routes, be made with consideration of the
potential effect
of noise pollution on the surrounding environment.
[36]
The Petroleum regulations also deal with the process and requirements
of an application for environmental authorisation. For
instance, reg
86(4) provides:
‘
The
designated agency, the Council of Geosciences and the Council for
Scientific Research must be identified as interested and affected

parties for the purposes of the public participation to be undertaken
as part of the Environmental Impact Assessment process.’
The
Petroleum regulations,
inter alia
, prescribe the submission of
the following as part of an application for an environmental
authorisation:
(a)
The geological overview report contemplated in reg 87(1) (reg 87(2));
(b)
The water resource monitoring plan contemplated in reg 88(2) (reg
88(3));
(c)
The seismicity risk assessment report contemplated in reg 89(1) and
the site-specific surveys contemplated in reg 89(2) (reg
89(3));
(d)
The well design risk assessment contemplated in reg 94(2) and the
proposed control measures contemplated in reg 94(3) (reg 94(4));
(e)
The final well decommissioning design (reg 95(2));
(f)
A well engineering design and hydraulic fracturing programme and
procedure (reg 110(2)
(a)
and
(b)
);
(g)
A risk assessment report in respect of fracturing fluid containment
(reg 114(2));
(h)
The risk management plan for each well contemplated in reg 115(1)
(reg 115(2)
(a)
);
(i)
The fluid transportation management plan contemplated in reg 117(1)
(reg 117 (2)
(a)
);
(j)
The proposals for the control and management of the risks of
hydraulic fracturing operations contemplated in reg 119(4)
(a)
(reg 119(4)
(b)
); and
(k)
A waste management plan (reg 125(1)).
[37]
A few provisions of the Petroleum regulations could, on the face
thereof, be regarded as dealing purely with the technical
aspects of
hydraulic fracturing. But in context most of them are aimed at
protecting the environment by,
inter
alia
,
ensuring well integrity and by minimising the risks of contamination
and pollution through leakages and blowouts. In this regard,

reference can be made to reg 96 (well construction standards), reg
100 (production casings), reg 103 (casing string tests),   reg

104 (formation pressure integrity tests), reg 105 (blowout
prevention) and reg 106 (pressure testing of blowout prevention
equipment).
Accordingly, only a small number of provisions do not
deal with the environmental aspects of petroleum exploration and
production.
[38]
Regulation 85
states that the purpose of the Petroleum regulations is
to prescribe standards and practices that must ensure the safe
exploration
and production of petroleum. When the content of the
Petroleum regulations is considered in the light of its genesis and
the material
known to its maker (particularly the report of the
inter-departmental task team and the objections to the draft
regulations), the
ineluctable conclusion is that the word ‘safe’
in reg 85 refers to the safety of the environment. In my view, the
dominant
purpose and effect of the Petroleum regulations is to
regulate the process and requirements of applications for
environmental authorisations
and to establish a regulatory framework
and norms and standards for the management of the environmental risks
of petroleum exploration
and production.
Environmental
Provisions of Petroleum regulations
ultra vires
[39]
It follows that most of the provisions of the Petroleum regulations
fell within the exclusive competence of the Environment
Minister and
were prohibited by s 44(1C) of NEMA. Nevertheless, both the Minerals
Minister and the Environment Minister sought
to avoid this conclusion
on different and, at times, contradictory grounds.
[40]
In this court, the Minerals Minister squarely accepted that the
Petroleum regulations deal with the process and requirements
of an
application for an environmental authorisation. The relevant
regulations
[15]
were referred
to as the process provisions. It is clear from
s 50A(2)
(c)
of NEMA and
s 38A
of the MPRDA that the Minerals Minister issues
environmental authorisations in terms of NEMA. They are not issued,
granted or approved
in terms of the MPRDA. The process provisions
were, therefore, not authorised by
s 107(1)
(g)
of the MPRDA.
[41]
The Minerals Minister contended, however, that the process provisions
were authorised by EIA reg 16. The argument suffers from
various
difficulties. First, the Petroleum regulations were expressly
promulgated under
s 107
of the MPRDA and it is not open to the
Minerals Minister to now rely on EIA reg 16.
[16]
Second, the Environment Minister has no power to make regulations
which confer authority on the Minerals Minister to make regulations,

let alone regulations regarding the very matters that Parliament
enjoined the Environment Minister to regulate. Third, reg 16 simply

does not authorise the Minerals Minister to regulate the process and
requirements of an application for environmental authorisation.
As I
have said, reg 16 only prescribes the formal requirements of an
application for an environmental authorisation.
[17]
[42]
The Minerals Minister further contended that the provisions of the
Petroleum regulations aimed at the management of the environmental

impacts of petroleum exploration or production were authorised by
s
107(1)
(l)
of the MPRDA. It will be recalled that this subsection empowers the
Minerals Minister to make regulations which may be necessary
or
expedient in order to achieve the objects of the MPRDA. In terms of
s
2
(h)
,
one of the objects of the MPRDA is to ‘give effect to s 24 of
the Constitution by ensuring that the nation’s mineral
and
petroleum resources are developed in an orderly and ecologically
sustainable manner while promoting justifiable social and
economic
development’.
[18]
The
sustainable development of South Africa’s mineral and petroleum
resources cannot be separated from the need to protect
the
environment, so it was argued, and therefore the management of
environmental impacts is necessary or expedient to achieve the
object
of sustainable development of resources.
[43]
The fundamental flaw in the argument, however, is that it ignores the
One
Environmental System
and
the statutory amendments made to give effect thereto. The argument
boils down to saying that the Minerals Minister had exactly
the same
powers to make regulations in respect of the environment before and
after the introduction of the
One
Environmental System
and its consequential amendments.  That this is quite untenable,
can be illustrated as follows. At the time when s 107 of
the MPRDA
contained both s 107(1)
(a)
and s 107(1)
(l)
,
the latter clearly did not authorise the making of regulations
regarding the matters specifically mentioned in s 107(1)
(a).
The purpose of the repeal of s 107(1)
(a)
in consequence of the
One
Environmental System
could not have been to expand the range of matters falling under s
107(1)
(l)
to include the very matters that had been deleted from s 107. As I
have said, the repeal of s 107(1)
(a)
could, in the context thereof, have had no purpose other than to
migrate the power to make regulations regarding environmental
impacts
to the Environment Minister. I therefore agree with the submission
that after the introduction of the
One
Environment System
,
the environment-related object of s 2
(h)
of the MPRDA is to be achieved through the application of NEMA to
petroleum exploration and production.  The provisions of
the
Petroleum regulations aimed at the management of environmental
impacts were neither necessary nor expedient in order to achieve
the
objects of the MPRDA.
[44]
The oral argument of the Environment Minister proceeded along the
following lines:
(a)
An environmental authorisation in terms of NEMA is essentially the
same as an environmental management programme and/or an environmental

management plan under the repealed s 39 of the MPRDA;
(b)
The repeal of the relevant provisions of the MPRDA divested the
Minerals Minister only of the power to regulate the function
of
granting or refusing an environmental authorisation;
(c)
The Petroleum regulations do not deal with the process or
requirements of an application for an environmental authorisation;

and
(d)
In the light of the remaining environmental provisions of the MPRDA,
the incidental regulation of environmental impacts of operations

under the MPRDA is authorised under s 107(1)
(f)-(l).
[19]
[45]
I am prepared to accept, without deciding, that proposition (a) is
correct. In line with,
inter
alia
,
the repealed s 38 of the MPRDA, the power to make regulations in
terms of s 107(1)
(a)
extended to matters far beyond the mere function of granting or
refusing an environmental authorisation. It is fair to say that
the
power to make regulations under s 107(1)
(a)
covered virtually every conceivable aspect of the management of the
environmental impacts of petroleum exploration and production.
That
is what was taken away from the Minerals Minister. Proposition (b)
therefore fails. As to proposition (c),     I

have shown, and the Minerals Minister conceded (and attempted to
justify), that the Petroleum regulations purport to regulate the

process and requirements of an application for an environmental
authorisation. The Minerals Minister correctly conceded that
proposition
(d) is entirely dependent on the acceptance of
proposition (b). As it is untenable, the argument implodes and
proposition (d) is
not reached. But it is in any event wrong. None of
the remaining environmental provisions of the MPRDA could sustain
regulations
under s 107(1)
(f)-(l)
.
These provisions in fact entail the implementation of NEMA.
[20]
[46]
In a written reply submitted after the hearing of the appeal, the
Environment Minister changed tack in respect of proposition
(c). It
was submitted that the various instances where additional reports and
information are to be submitted as part of an application
for an
environmental authorisation, are justified by the constitutional
imperative of co-operative government under s 41 of the
Constitution
and are therefore not an impermissible regulation of environmental
aspects. I am unable to agree with this submission.
The
One
Environmental System,
the
implementation of which,
inter
alia
,
vests the power to make regulations of this kind in the Environment
Minister, is itself a commendable example of co-operative
government.
And it is inherent in the principle of co-operative government that
an organ of state may only exercise a power conferred
on it and may
not encroach on the powers of another.
[21]
The Minerals Minister could not under the guise of co-operative
government exercise powers that he did not have, nor could the

principle of co-operative government be invoked to, in effect, render
the repeal of s 107(1)
(a)
of the MPRDA meaningless.
[47]
In dismissing the challenge to the power of the Minerals Minister to
make the Petroleum regulations, the court in the TKAG
matter
essentially reasoned that the Petroleum regulations entailed no more
than cross-referencing to and implementing of the provisions
of NEMA
and the EIA regulations, and that they ‘squarely fall within
the ambit of s 107(1)
(l)
of the MPRDA’. For the reasons mentioned, the Petroleum
regulations are not limited to these categories and, in any event,
to
implement a legislative provision means to apply it, not to make it.
It is difficult to fathom how regulations that merely cross-refer
to
and implement other legislation, could be authorised by s 107(1)
(l)
,
but in the circumstances this requires no further consideration. It
follows that I agree with the decision of Bloem J in the Stern
matter
on this point.
[48]
To sum up, the greater part of the Petroleum regulations regulates
the process and requirements of an application for an environmental

authorisation and provides a regulatory framework and norms and
standards for managing the environmental impacts of exploration
and
production of petroleum. Only the Environment Minister, and not the
Minerals Minister, had the power to regulate these matters.
Conclusion
[49]
In
Coetzee
v Government of the Republic of South Africa, Matiso & others v
Commanding Officer Port Elizabeth Prison & others
[22]
para 16, the following passage in
Johannesburg
City Council v Chesterfield House (Pty) Ltd
[23]
was approved:
‘
where it
is possible to separate the good from the bad in a Statute and the
good is not dependent on the bad, then that part of
the Statute which
is good must be given effect to, provided that what remains carries
out the main object of the Statute . . .
. Where, however, the task
of separating the bad from the good is of such complication that it
is impracticable to do so, the whole
Statute must be declared
ultra
vires
.’
Despite
the fact that the majority of the provisions of the Petroleum
regulations were
ultra
vires
,
the separation of these provisions from those that were authorised,
is complicated and impractical. It would also lead to an incoherent

remainder. Therefore, the Petroleum regulations must be set aside in
their entirety, irrespective of whether PAJA or the principle
of
legality applies.
[50]
The procedural unfairness complained of in the Stern matter was that
the draft regulations published for public comment
[24]
did not list substances that would be prohibited from use in the
fracturing process. In response hereto, the Minerals Minister

explained that reg 113(1) of the Petroleum regulations and the list
of prohibited substances in Schedule I thereto, had been the
result
of the public participation process.
This
response appears to have some substance, but, in the light of the
conclusion that I have reached, it is not necessary to determine
this
issue. Nor is it necessary to pronounce on the antecedent question,
namely whether PAJA applied to the making of the Petroleum

regulations. In
Mostert
NO v Registrar of Pension Funds and
others
[25]
,
this court explained that the decision in
Minister
of Health & another NO v New Clicks South Africa (Pty) Ltd &
others (Treatment Action Campaign and another as amici
curiae)
[26]
is
no authority for the proposition that the making of regulations by a
minister generally is administrative action in terms of
PAJA and
added that the final word on this subject may not have been spoken.
For the reasons mentioned, the determination of this
appeal does not
require us to resolve this question.
[51]
It remains to deal briefly with the plea of non-joinder raised in the
Stern matter. The Minerals Minister contended that Bundu,
Falcon and
Shell should have been joined in those proceedings. In order for them
to have been necessary parties to the Stern matter,
they had to have
a direct and substantial interest in the outcome of the litigation.
This meant a legal interest in the subject-matter
of the application
which could be prejudicially affected by the order in that
application.
[27]
The relevant
subject-matter in the Stern matter concerned the power of the
Minerals Minister to make regulations in respect of
environmental
matters. Bundu, Falcon and Shell had no legal interest in the
determination of this issue. Their interests in the
application were,
at most, of an indirect financial nature.
[52]
Finally, the Minerals Minister argued that a declaration of
invalidity should be suspended to allow the relevant Minister to

lawfully promulgate regulations. In my view, however, there is no
factual basis for this request and the opposing argument that

exploration for petroleum by hydraulic fracturing should not take
place at all before it is lawfully regulated, is compelling.
It
follows that the appeal in the Stern matter must be dismissed and the
appeal in the TKAG matter must succeed.
[53]
The following order is issued:
In
the Stern matter
:
1
The appeal is dismissed with costs, including the costs of two
counsel.
In
the TKAG matter
:
1
The appeal is upheld with costs, including the costs of two counsel.
2
The order of the court a quo is set aside and replaced with the
following:
‘
(a)
The Regulations for Petroleum Exploration and Production, 2015 that
came into effect on 3 June 2015, in accordance with Government
Notice
R466 in Government Gazette 38855, are reviewed and set aside.
(b)
The respondents, jointly and severally, are ordered to pay the costs
of this application, including the cost of two counsel.’
________________________
C
H G van der Merwe
Judge
of Appeal
APPEARANCES
For
the Minister of Mineral Resources: H Maenetje SC, with him N Muvangua
Instructed
by:
Whitesides
Attorneys, Grahamstown
State
Attorney, Bloemfontein
For
Stern NO and others: A Breitenbach SC, with him H C Schreuder
Instructed
by:
Dold
& Stone, Grahamstown
McIntyre
Van der Post, Bloemfontein
For
Treasure the Karoo Action Group
and
AfriForum: P Lazarus SC, with him A Pantazis
Instructed
by:
Hurter
Spies Inc. Attorneys, Centurion
McIntyre
Van der Post, Bloemfontein
For
the Minister of Environmental Affairs: M Oosthuizen SC, with him F
Patel
Instructed
by:
State
Attorney, Pretoria
State
Attorney, Bloemfontein
[1]
GN R466,
GG
38855, 3 June 2015.
[2]
In terms of the Petroleum regulations
‘”hydraulic fracturing” means injecting fracturing
fluids into the target
formation at a pressure exceeding the parting
pressure of the rock to induce fractures through which petroleum can
flow to the
wellbore’.
[3]
Mineral and Petroleum Resources
Development Act (28/2002
): South African Agency for Promotion of
Petroleum Exploration and Exploitation (Pty) Ltd (Petroleum Agency
SA): Moratorium under
s 49(1)
, GN 54,
GG
33988, 1 February 2011.
[4]
Mineral and Petroleum Resources
Development Act (28/2002
): Proposed Technical Regulations for
Petroleum Exploration and Exploitation, GN 1032,
GG
36938, 15 October 2013.
[5]
Mineral and Petroleum Resources
Development Act (28/2002
): Restriction in terms of s 49(1) of the
Mineral and Petroleum Resources Development Act, 2002 (Act No. 28 of
2002) on granting
of new applications for reconnaissance permits,
technical co-operation permits, exploration rights and production
rights in terms
of ss 74, 76, 79 and 83 of the Act, GN 71,
GG
37294, 3 February 2014.
[6]
The Government Notice also referred
to the provisions of s 14 of the Interpretation Act 33 of 1957, but
the parties are in agreement
that these provisions play no role in
the appeal.
[7]
See para 9 above.
[8]
MPRDA 2002, section 69(2):
‘
(a)
For the purposes of this Chapter, section 9, 10, 11, 12, 21, 26, 29,
30, 37, 38A, 38B, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52,
53, 54,
55, 56, 64 and Chapter 7 and Schedule II apply with the necessary
changes.
(b)
Any
reference in the provisions referred to in paragraph
(a)
to—
(i) minerals, must be construed as a
reference to petroleum;
(ii) mining, must be construed as a
reference to production;
(iii) mining area, must be construed
as a reference to production area;
(iv) mining rights, must be construed
as a reference to production rights;
(v) prospecting, must be construed as
a reference to exploration;
(vi) prospecting area, must be
construed as a reference to exploration area;
(vii) prospecting rights, must be
construed as a reference to exploration rights; and
(viii) reconnaissance permission,
must be construed as a reference to reconnaissance permit.’
[9]
Section 50A of NEMA was substantially
replicated in
s 163A
of the
National Water Act 36 of 1998
.
[10]
In terms of
s 1
of NEMA ‘prescribe’
means prescribe by regulation in the Gazette.
[11]
In terms of
s 1
of NEMA ‘this
Act’ includes the schedules, regulations and any notice issued
under the Act.
[12]
The EIA regulations were published in
GN R982,
GG
38282, 4 December 2014 and were amended by GN 326 published in
GG
40772, 7 April 2017 and by GN 706,
GG
41766, 13 July 2018.
[13]
Regulations published under GN R1288,
29 October 2004, as amended by GN R1203, 30 November 2006 and GN
R349, 18 April 2011.
[14]
Reference could also be made to regs
87(1), 88(4), 88(5), 88(7), 89(5), 89(8), 94(3), 95(4), 98,
99(2)-(5), 114(4), 116(2), 119(3)
(b)
,
123(2), 123(3), 124(3), 124(8), 126(2), 127(2)-(7), 128(3) and
129(2).
[15]
See para 36 above.
[16]
See
Minister
of Education v Harris
[2001]
ZACC 25
;
2001 (4) SA 1297
(CC) para 18.
[17]
EIA reg 16(1)
(a)
,
for instance, provides that an application for an environmental
authorisation must be made on an official application form
obtainable from the relevant competent authority. Regulation 16(3)
reads:
‘
Any report, plan or document
submitted as part of an application must –
(a) comply with any protocol or
minimum information requirements relevant to the application as
identified and gazetted by the
Minister in a government notice;
(b) be prepared in a format that may
be determined by the competent authority; and
(c) take into account any applicable
government policies and plans, guidelines, environmental management
instruments and other
decision making instruments that have been
adopted by the competent authority in respect of the application
process or the kind
of activity which is the subject of the
application and indicate how the relevant information has been
considered, incorporated
and utilised.’
[18]
Constitution of the Republic of South
Africa, 1996 section 24:
‘
24 Environment.
—
Everyone has the right—
(a)
to
an environment that is not harmful to their health or well-being;
and
(
b
) to have the environment
protected, for the benefit of present and future generations,
through reasonable legislative and other
measures that—
(i) prevent pollution and ecological
degradation;
(ii) promote conservation; and
(iii) secure ecologically sustainable
development and use of natural resources while promoting
justifiable economic and
social development.’
[19]
Apart from the third preamble, s 2
(h)
and other provisions of
the MPRDA that deal with sustainable development of resources (ss
3(3) and 37(2)), the Environment Minister
identified ss 17(1)
(c),
23(1)
(d),
37(1), 43, 45, 46,
75(1)
(c),
80(1)
(c)
and 84(1)
(c)
as the remaining environmental provisions of the MPRDA.
[20]
By way of example, ss 17(1)
(c)
,
23(1)
(d)
and 75(1)
(c)
provide that the Minerals Minister must grant a prospecting right, a
mining right or a reconnaissance permit, as the case may
be, if,
inter alia,
the
respective prospecting, mining or reconnaissance ‘will not
result in unacceptable pollution, ecological degradation
or damage
to the environment and an environmental authorisation is issued.’
Section 84(1)
(c)
in turn provides that the Minerals Minister must grant a production
right if,
inter alia
,
that will not result in unacceptable pollution, ecological
degradation or damage to the environment. That there would be no

such prejudicial effects on the environment, would in each case be
determined by the process and requirements of an application
for an
environmental authorisation in terms of the EIA regulations. Section
37(1) provides:
‘
The principles set out in
section 2 of the National Environmental Management Act, 1998 (Act
No. 107 of 1998)—
(a)
apply
to all prospecting and mining operations, as the case may be, and
any matter or activity relating to such operation.
(b)
serve
as guidelines for the interpretation, administration and
implementation of the environmental requirements of this Act.’
Section
43(1) provides:
‘
The holder of a prospecting
right, mining right, retention permit, mining permit, or previous
holder of an old order right or
previous owner of works that has
ceased to exist, remains responsible for any environmental
liability, pollution, ecological
degradation, the pumping and
treatment of extraneous water, compliance to the conditions of the
environmental authorisation and
the management and sustainable
closure thereof, until the Minister has issued a closure certificate
in terms of this Act to the
holder or owner concerned.’
Section
45(1) provides:
‘
If any prospecting, mining,
reconnaissance, exploration or production operations or activities
incidental thereto cause or results
in ecological degradation,
pollution or environmental damage, or is in contravention of the
conditions of the environmental authorisation,
or which may be
harmful to health, safety or well-being of anyone and requires
urgent remedial measures, the Minister, in consultation
with the
Minister of Environmental Affairs and Tourism, may direct the holder
of the relevant right or permit in terms of this
Act or the holder
of an environmental authorisation in terms of
National Environmental
Management Act, 1998
, to—
(a)
investigate,
evaluate, assess and report on the impact of any pollution or
ecological degradation or any contravention of the
conditions of the
environmental authorisation;
(b)
take
such measures as may be specified in such directive in terms of this
Act or the
National Environmental Management Act, 1998
; and
(c)
complete
such measures before a date specified in the directive.’
Section 46(1)
provides:
‘
If the Minister
directs that measures contemplated in
section 45
must be taken to
prevent pollution or ecological degradation of the environment, to
address any contravention in the environmental
authorisation or to
rehabilitate dangerous health or safety occurrences but establishes
that the holder of a reconnaissance permission,
prospecting right,
mining right, retention permit or mining permit, the holder of an
old order right or the previous owner of
works, as the case may be
or his or her successor in title is deceased or cannot be traced or
in the case of a juristic person,
has ceased to exist, has been
liquidated or cannot be traced, the Minister in consultation with
the Minister of Environmental
Affairs and Tourism, may instruct the
Regional Manager concerned to take the necessary measures to prevent
pollution or ecological
degradation of the environment or to
rehabilitate dangerous health and social occurrences or to make an
area safe.’
As I have said, in terms
of
s 69(2)
a reference in these sections to prospecting must be
construed as a reference to exploration and the reference to mining
must
be construed as a reference to production.
[21]
In terms of s 41 of the Constitution:
‘
(1) All spheres of government
and all organs of state within each sphere must –
. . .
(e)
respect
the constitutional status, institutions, powers and functions of
government in the other spheres;
(f)
not
assume any power or function except those referred on them in terms
of the Constitution;
(g)
exercise
their powers and perform their functions in a manner that does not
encroach on the geographical, functional or institutional
integrity
of government in another sphere.’
[22]
[1995] ZACC 7
;
1995 (10) BCLR 1382
;
1995 (4)
SA 631.
See also
Premier,
Limpopo Province v Speaker of the Limpopo Provincial Legislature &
others
[2012] ZACC3;
2012 (4) SA 58
(CC);
2012 (6) BCLR 583
(CC) paras
22-28.
[23]
[1952] 3 All SA 436
(A);
1952 (3) SA
809
(A) at 822D-E.
[24]
See para 14 above.
[25]
[
2017]
ZASCA 108
;
2018
(2) SA 53
(SCA) paras 8-10.
[26]
[2005]
ZACC 14; 2006 (1) BCLR 1 (CC); 2006 (2) SA 311 (CC).
[27]
See
De
Villiers & others v GJN Trust & others
[2018] ZASCA 80
;
2019 (1) SA 120
(SCA) paras 22-24.