Minister of Mineral Resources and Energy and Others v Sustaining the Wild Coast NPC and Others

On 29 April 2014, the Minister of Mineral Resources and Energy granted Impact Africa Limited an exploration right for oil and gas exploration off the Wild Coast, to be exercised by Shell Exploration and Production South Africa B.V. and BG International Limited. The exploration right was subsequently renewed twice: on 20 December 2017 and 26 August 2021. When Shell and Impact sought to conduct seismic surveys pursuant to the exploration right, affected communities and environmental organizations approached the Eastern Cape High Court for interdictory relief on 2 December 2021. An interim interdict was granted on 28 December 2021. The applicants challenged the grant and renewals of the exploration right on the basis that there was insufficient consultation with affected communities, particularly the Amadiba and Dwesa-Cwebe communities along the Wild Coast who would be impacted by the seismic blasting activities. The consultation process consisted mainly of notices published in four newspapers (three in English, one in Afrikaans), emails to stakeholders, and public meetings. However, most members of the affected communities speak isiXhosa or isiMpondo, few read English, and virtually nobody speaks Afrikaans. Newspapers do not circulate in these communities. The communities primarily receive news via radio (Ukhozi FM and Umhlobo Wenene). The applicants alleged they only became aware of the exploration right in October/November 2021 when SLR Consulting gave notice of Shell's intention to commence the seismic survey.

• Whether the review application was brought within the 180-day time limit prescribed by section 7(1) of PAJA
• Whether the respondents were required to exhaust internal remedies (appeal under section 96 of the MPRDA) before bringing the review application
• Whether the consultation process undertaken by Impact Africa Limited was adequate to satisfy the requirements of procedural fairness under section 33 of the Constitution and section 3 of PAJA
• Whether relevant considerations were taken into account when granting the exploration right and renewals
• Whether the High Court erred in failing to consider just and equitable relief under section 172(1)(b) of the Constitution when setting aside the decisions
• What constitutes an appropriate and just remedy under section 172(1)(b) of the Constitution in circumstances involving administrative irregularities

The appeal was substantially dismissed with costs, including costs of two counsel to be paid jointly and severally by the appellants. However, the order of the High Court was amended by adding paragraph 5, which suspends paragraphs 1, 2 and 3 (setting aside the grant and renewals of exploration right 12/3/252) pending determination of the application submitted on 21 July 2023 for renewal of the exploration right pursuant to section 81 of the MPRDA.

The binding legal principles established are: (1) The 180-day period for bringing a review under section 7(1) of PAJA only begins to run when the administrator has properly notified affected persons or the public of the administrative decision in accordance with the requirements of sections 3 or 4 of PAJA, not merely when the decision is made or when an application for the right is publicized. (2) Meaningful consultation under the MPRDA and PAJA requires that affected communities be engaged in accessible languages and through media that actually reach them. Newspaper advertisements in English and Afrikaans are inadequate to consult communities that speak isiXhosa or isiMpondo and receive news primarily via radio. (3) When administrative action is found to be unlawful, courts must consider just and equitable relief under section 172(1)(b) of the Constitution rather than automatically setting aside the decision. Relevant factors include: the period of delay, financial expenditure in reliance on the decision, the interests of innocent third parties, public interest in finality of administrative decisions, the materiality of the irregularity, and the availability of alternative remedies to cure defects. (4) Suspension of an order setting aside an administrative decision is an appropriate remedy under section 172(1)(b) where it allows for correction of procedural defects (such as conducting a proper consultation process) while minimizing disruption and prejudice to parties who relied on the validity of the decision. (5) Under section 81(5) of the MPRDA, an exploration right in respect of which a renewal application has been lodged remains in force notwithstanding its expiry date until the renewal application has been granted or refused.

The SCA made several significant obiter observations: (1) The court criticized the High Court's finding that '[a]uthorising new oil and gas exploration, with its goal of finding exploitable oil and/or gas reserves and consequently leading to production, is not consistent with South Africa complying with its international climate change commitments.' The SCA characterized this as 'a far-reaching finding, which has a sterilising effect and for which there can be no warrant'. This suggests the SCA was cautioning against courts making sweeping policy pronouncements about the incompatibility of fossil fuel exploration with climate commitments without a proper evidentiary basis and full consideration of the complex policy issues involved. (2) The court emphasized that just and equitable remedies under section 172(1)(b) must be: proportionate (noting it would be disproportionate to set aside an entire project as a consequence of an imperfect process); fair and just in the context of the particular dispute; and ample and flexible, placing substance above form. (3) The court observed that the moratorium on new exploration rights over the entire South African coast means Shell and Impact may never get another opportunity to exercise the exploration right, which was a relevant consideration in crafting the remedy. (4) The court noted the possible 'chilling effect on foreign investment' of legal uncertainty, suggesting this is a relevant consideration in administrative law remedies, though it did not elaborate on the weight to be given to this factor.

This judgment is significant in South African administrative and environmental law for several reasons: (1) It clarifies when the 180-day period under PAJA begins to run, emphasizing that it only starts when the administrator has properly notified affected persons of the decision, not merely when the decision is made or when an application is publicized. (2) It establishes important principles regarding meaningful consultation with communities, particularly in the context of mining and exploration rights affecting marginalized communities. The judgment emphasizes that consultation must be conducted in accessible languages and through media that actually reach the affected communities, not merely through formal compliance with notice requirements. (3) It demonstrates the proper application of section 172(1)(b) of the Constitution, emphasizing that courts must consider just and equitable relief rather than automatically setting aside unlawful administrative action. The judgment highlights factors to be balanced including: reliance interests, financial expenditure, delay, public interest in finality, and the availability of alternative remedies. (4) It illustrates the court's remedial flexibility, showing that suspension of a setting-aside order can be an appropriate remedy where it allows for correction of procedural defects while minimizing disruption and prejudice to innocent parties. (5) It reinforces that procedural fairness under PAJA and the MPRDA requires substantive engagement with affected communities, not merely technical compliance with notice requirements. The judgment recognizes the intersection of administrative justice, community rights, environmental protection, and economic development interests.