Fuelling controversy: Bunkering on the sidelines of Sona

COMMENT

On 8 February, South Africans settled in to listen to President Ramaphosa’s State of the Nation address. Amid the usual rhetoric about unemployment, health, climate change and load-shedding, the president said that “with the current conflict in the Middle East affecting shipping traffic through the Suez Canal, South Africa is well positioned to offer bunkering services for ships that will be rerouted via our shores.” 

One would be forgiven for not paying this in-passing statement the attention it deserved.

What exactly is bunkering, and why should we be concerned about its occurrence in our waters? Bunkering entails the transfer of fuel from one vessel to another while at sea. It is a high-risk operation with the potential for severe marine pollution through oil and fuel spills.

Beyond the immediate environmental risks, bunkering contributes to heightened shipping traffic and increased noise levels, affecting the foraging and breeding patterns of diving seabirds, notably the endangered African penguin.

Bunkering is a relatively recent activity in South Africa, currently confined to Algoa Bay — a region celebrated for its extraordinary biodiversity and islands, including St Croix, which host important colonies of African penguins.

Three operators are conducting bunkering in Algoa Bay and, since 2016, the area has experienced four significant oil spills, adversely affecting more than 200 seabirds and exacerbating the problems faced by already dwindling populations. 

A groundbreaking study has provided scientific evidence linking the onset of bunkering in Algoa Bay in 2016 to a notable increase in vessel-driven noise. This surge in noise correlated with the fastest short-term decline ever recorded in an African penguin population — an alarming 85% reduction in the once-largest colony at St Croix Island.

Recognising the significant environmental impacts associated with bunkering (which is not regulated in terms of South Africa’s environmental legislation), Transnet National Ports Authority (commissioned an environmental risk assessment aimed at ensuring that bunkering is undertaken responsibly and that all environmental, social and maritime risks are identified and sufficiently managed to avoid and minimise the negative effects associated with these activities. 

A moratorium on new bunkering licences is in place pending the outcome of the risk assessment, which was released for public comment on 30 November last year. However, a recent post by Samsa alarmingly indicates that it will recommence processing bunkering licence applications in Algoa Bay: “Following a SAMSA Board decision in line with its legislated mandate the Authority undertakes to process applications in terms of section 21(1)(b) of Marine Pollution (Control and Civil Liability) Act, 1981 (Act No 6 of 1981) (hereinafter `the Act) pertaining to offshore operations in Algoa Bay, without delay.” The implications of this announcement on the moratorium, and pending completion of the risk assessment, remain unclear.

There are several significant concerns regarding the risk assessment and whether it can achieve its purpose, which are documented in comments submitted to Nemai Consulting by the Biodiversity Law Centre on 31 January this year. First, it appears that the severity of several of the environmental impacts, including the possibility of vessel collisions with marine fauna and the effect of hydrocarbon spills on marine biota, have been significantly underestimated. 

Second, the risk assessment puts forward several mitigation measures in the context of oil spill management that are speculative at best. The risk assessment does acknowledge that of greatest concern (in terms of undeniable effect of bunkering on the marine ecology) is the continuous decline in numbers of African penguin and Indian Ocean humpback dolphin, both of which show immediate behavioural responses to the non-impulsive noise emissions from in-transit marine traffic and from stationary bunkering operations.

It concedes that the effect of underwater noise as a result is of very high significance, both before and after mitigation. Ordinarily, a finding of this nature would render the proposed development fatally flawed — language which does not find its way into the risk assessment.

This raises a crucial question: why should an activity with potentially severe environmental risks be conducted in a bay with such sensitive biodiversity? 

It is reasonable to expect that the socio-economic impact assessment (SIA) accompanying the risk assessment would address this concern. But the study proved unduly narrow, concentrating mainly on the effects of oil contamination on the fishing, aquaculture, and tourism sectors, while offering limited insights into the socio-economic dimensions of offshore bunkering. 

Notably, the SIA acknowledges that obtaining indicative cost data for bunkers was avoided because of commercial sensitivity, emphasising that a significant portion of the fuel supply value chain lies outside South Africa. Consequently, understanding the socio-economic justification for bunkering is challenging at best, especially when a substantial portion of the economic benefits seems to accrue to foreign stakeholders.

Is there any financial benefit to South Africans? Or is the government simply permitting a dangerous activity to occur in sensitive ecosystems without any domestic advantages?

Unsurprisingly, the risk assessment makes no definitive recommendations on the continuation or expansion of bunkering in Algoa Bay. The unsettling aspect of this uncertainty lies in the possibility that, once the risk assessment is finalised (and what this entails remains unclear), the moratorium may be lifted. Given the recent report by Samsa, there is every indication that this will imminently be the case.

This potential scenario raises grave concerns because it could open the door for additional bunkering operators in Algoa Bay and sets the stage for bunkering activities to extend to other regions. Recent reports point to the South African Maritime Safety Authority (Samsa) exploring St Helena Bay as an additional bunkering destination, with an “environmental status quo” report on bunkering having been released in November 2022.

All of this is happening in a regulatory vacuum. Bunkering is not included under our environmental legislation as an activity requiring an environmental impact assessment, despite advocacy efforts to secure such regulation. This means bunkering activities are not scrutinised from an environmental perspective before being authorised by Samsa and the Transnet National Ports Authority — a deeply concerning position should the moratorium be lifted, and additional bunkering operations facilitated.

There is also the not-so-insignificant issue of the South African Revenue Service (Sars) having detained five vessels involved in bunkering pending an investigation as to whether the Customs and Excise Act 91 of 1964 had been contravened. A key bone of contention here is whether bunker fuel should be considered imported and therefore subject to excise tax. While the timeline to resolve the tax issues raised by Sars is not clear, the impasse has — at least temporarily — put a hold on bunkering operations.

There are clearly significant environmental impacts associated with bunkering, not least of which is the dramatic decline in endangered African penguins. Additionally, it is unclear how bunkering is justified from a socio-economic perspective, with the SIA being murky at best.

Considering these environmental and socio-economic uncertainties, the evident harm to biodiversity, and the potential long-term consequences, careful consideration and a cautious approach dictate that bunkering should not be permitted in sensitive ecosystems such as Algoa Bay.

Kate Handley is an environmental attorney and co-founder of the Biodiversity Law Centre, a nonprofit organisation that seeks to use the law to reverse the catastrophic decline of biological diversity in Southern Africa.