UK-headquartered energy giant Shell has hit a dead end in its plans for oil and gas exploration off South Africa’s Wild Coast, after the Constitutional Court overturned a Supreme Court of Appeal (SCA) order that had kept the project alive, delivering a major victory for environmental groups and local communities.
South Africa’s Constitutional Court has upheld an appeal by environmental justice organizations, including Sustaining the Wild Coast, Natural Justice, Greenpeace Africa, and All Rise Attorneys for Climate and Environmental Justice, together with affected Wild Coast communities and fishing interests. The Court found that the Supreme Court of Appeal had erred in suspending a High Court order that set aside an exploration right granted to Impact Africa, and subsequently renewed in 2017 and 2021, with a 50% participating interest later transferred to Shell.
The dispute began in 2021, when Shell announced plans for a 3D seismic survey along the Wild Coast. In response, environmental organizations, communities, and fishers challenged the exploration right, arguing that they had not been meaningfully consulted and that authorities had failed to properly consider marine and bird life, cultural and livelihood rights, climate change, and the precautionary principle.
The majority judgment, written by Kollapen J, found that the case raised important constitutional questions concerning meaningful public consultation, environmental and community rights, administrative justice, and the requirements for a “just and equitable” remedy when government decisions are found unlawful.
The court on Friday, August 14, 2026, reinstated the Makhanda High Court’s decision to set aside the original exploration right and its two renewals. The High Court had found the decisions unlawful on three independent grounds: inadequate consultation, failure to consider relevant environmental and community interests, and non-compliance with the MPRDA.
The Constitutional Court majority rejected the SCA’s approach of using a further renewal process to address those defects and found that consultation more than a decade after the original decision could not fully remedy communities’ lost opportunity to participate, while significant changes since 2013 meant that a fresh assessment would effectively resemble a new application.
The Court also concluded that remittal could unfairly benefit the companies and potentially allow them to improve their case after an unlawful process. It stressed that commercial investment cannot outweigh serious constitutional violations.
Rogers J, joined by Savage J, dissented, arguing that the matter should be remitted for fresh consultation and reconsideration, potentially preserving a final three-year exploration period. He said the companies’ approximately R1.1 billion ($68 million) investment should be considered, warning that permanently blocking the application could leave it in legal limbo.
The ruling removes the route for Shell and Impact Africa to revive the existing exploration right through the third renewal process, marking a significant setback for offshore oil and gas exploration in the Wild Coast region.
Meanwhile, other African nations are actively working to entice companies to invest in offshore hydrocarbon exploration, as demonstrated by Nigeria’s new tax incentives designed to unlock up to $50 billion in deepwater oil and gas investment.
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