Offshore Petroleum Exploration

Editorial

The Offshore Petroleum Bill was presented at the National Assembly by the Prime Minister, Hon Pravind Jugnauth, this week. This Bill repeals the Petroleum Act of 1970, and provides for the conduct of petroleum activities in the seabed and subsoil areas of the maritime zones of Mauritius, such as the prospection, exploration, retention and production of petroleum. It also paves the way for the creation of a regulatory body to regulate, monitor, oversee and facilitate petroleum activities, namely the Department for Continental Shelf, Maritime Zones Administration and Exploration, which in collaboration with relevant stakeholders, shall, on behalf of the Government, negotiate petroleum agreements with potential investors for exploration/retention/production licences. It will also formulate strategies and policies to minimise and manage the impacts of petroleum activities in the marine environment.

The Bill also details the conditions for application and grant of the titles, and the responsibilities of the title holder too. We thus learn from the provisions of the Bill that ‘no person shall engage in petroleum activities in the maritime zones unless he/she is the holder of a title and no title shall be granted except with the approval of the Prime Minister’ – which makes it clear that all the decisions relating to the prospection, exploration, retention and production of petroleum will ultimately come under the control and direction of one authority – the Prime Minister.

We are not aware at this stage if confidentiality clauses will be introduced in the titles between the Mauritian government and potential foreign investors, thereby shielding their terms and conditions from parliamentary scrutiny, but that should not come as a surprise in light of other experiences such as the Bank of Mauritius (MIC) disbursements to private sector companies or even, on commercially sensitive grounds. It is therefore doubtful whether this will meet the imperative for transparency and accountability in ocean governance, as flagged by the PM in his presentation of the Bill.

Besides highlighting how the Offshore Petroleum Bill would be ‘a major breakthrough for the country, the more so against the backdrop of the Covid-19 pandemic and the need to provide the right impetus for the economic machinery’, Hon Jugnauth also informed the House that operations in this regard had been kick-started in February 2020, when an agreement for the conduct of geoscientific survey was signed between the Prime Minister’s Office and CGG services SAS for undertaking ‘multiclient seismic data position, processing, interpretation, data brokering, sales and marketing of seismic offshore geoscientific surveys over an exploration area covering a total of around 45 000 line-kilometres in four selected areas of the Exclusive Economic Zone (EEZ) of Mauritius’.

The timing of the introduction of the Bill comes at an inopportune time – on the eve of the opening of the COP26 summit in Glasgow – and its emergency push through Parliament are clearly not in sync with Government’s declared commitment to transition to non-renewable sources of energy in the next decades. The agreement discretely signed 18 months ago with CGG and the undue haste to push this bill, raises questions whether the Government would be in presence of preliminary reports indicating economically profitable deposits of petroleum/oil/gas in the 2.3 million square kilometres of the EEZ of Mauritius, not in the immediate 200 mile exclusive economic zone, which forms part of the volcanic chain of Mascarene Islands. If so, this should be treated as a national asset, handled in all transparency, rather than left to the discretionary powers of a single person, even if that person is the PM. however, as is its wont, it should unfortunately be expected that this Government will pay little attention to protests already being voiced by civil society and environmentalists against this Bill and the ambition of the current government in this area.

Over the past decade, exploration operations have multiplied across sub-Saharan Africa and Madagascar with at least 90% of African countries now exploring for oil and gas. Invariably, African governments flag the potential of oil and gas finds to transform their economies and improve the lives and livelihoods of their populations. However the economic, social and security benefits of oil and gas operations in some cases remain unclear. What is clear is where there have been large exploitable reserves of petroleum products, they have often been associated with immense graft and greed opportunities while the population has remained locked in backward conditions. The Congo, Nigeria, Angola and Madagascar are unfortunate reminders that wealth associated with such discoveries and their exploitation have been termed a “curse” on sub-saharan Africa.

The US Center for African Strategic studies (CESA) in a 2015 report highlighted this blight thus: “Les cinq premiers pays producteurs de pétrole de l’Afrique subsaharienne se classent dans le dernier tiers à l’échelle mondiale pour ce qui est de la mortalité infantile. Les deux producteurs les plus importants du continent, l’Angola et le Nigéria, se classent parmi les dix derniers dans cette catégorie.” This is not to say that development opportunities should be ignored; we cannot perhaps afford that luxury, so long as we avoid the too obvious traps and pitfalls, that may in the long run, add us to the list of countries reputed for fast bucks and oily deals.

On the greenhouse and carbon emission front, the New Zealand government announced in 2018 that it will not issue any new permits for offshore exploration for oil and gas deposits. Like Mauritius, New Zealand is a small player in global emissions of greenhouse gases, but it decided against exploring for more oil reserves so as to meet the Paris Agreement target of keeping global temperature rise this century well below two degrees above pre-industrial levels. ‘Almost all of the already known reserves must stay in the ground, and there is no room to go exploring for more; our actions can carry symbolic weight on the world stage. We have as much responsibility as any country to reduce our emissions.’

With an abundance of solar, biomass, wind, wave and tidal energy, like New Zealand, Mauritius can also ambition to become an environmentally respectful country, aiming for zero-carbon footprint in the medium-term. To achieve this ambitious effort will require more than perfunctory rhetoric or the signature of international treaties that may not be implemented. It will require understanding and adhesion to those greenhouse effects and targets, as all island states remain particularly vulnerable to the sea-level rise that accompanies sea-warming, the meltdown of both arctic poles and the unpredictable violence of cyclones or hurricanes. The haste with which legislative regulation and its inherent decision-making flaws is being pushed through does not bode well for the future.

* Published in print edition on 29 October 2021