Shell in hot water in South Africa

Petrochemical powerhouse Shell has asked government to reduce at least three fines imposed on the company.

This comes after Shell Downstream South Africa (SDSA) was found to be operating several service stations that were built or expanded without mandatory environmental impact assessments (EIAs), according to documents seen by Daily Maverick.

These studies are necessary to determine the extent to which a new petrol station could potentially harm the environment in which it is planned to be erected.

SDSA admitted to setting up several service stations in Durban without completing these assessments – three of which are located on Clare Road, Field Street, and Parthenon Street – and it was subsequently slapped with a fine of R250,000 for each of these locations.

The company has, however, pleaded for leniency, stating that these fines are “too high” and asking the provincial Department of Economic Development, Tourism, and Environmental Affairs to reduce them.

A slap on the wrist

Professor Jenny Hall, University of Johannesburg senior law lecturer, told Daily Maverick that fines of this nature can, in fact, go as high as R5 million.

Additionally, she noted that on top of an administrative fine, offenders of this kind could be prosecuted and fined a further R10 million even after the initial administrative fine for developments completed without an EIA process.

Hall therefore likens the R250,000 penalties, which collectively total R750 million, to a “slap on the wrist.”

Shell isn’t the only fuel retailer that has been convicted of these acts. BP Southern Africa was also found guilty of similar offences earlier this year by the Gauteng High Court.

Hall notes that part of the problem could be stemming from a legal loophole in the National Environmental Management Act (NEMA).

Section 24G of NEMA allows developers to apply for retrospective authorisation of illegal developments and pay an administrative fine.

While billed as a way for offenders to rectify past environmental law transgressions, critics of Section 24G say it encourages non-compliance by motivating contractors to adopt a “start now and say sorry later” approach to their projects.