ENVIRONMENTAL IMPACT REPORT AND ENVIRONMENTAL MANAGEMENT PROGRAMME FOR AN EXPLORATION RIGHT APPLICATION FOR PETROLEUM PRODUCTS ON VARIOUS FARMS IN THE MAGISTERIAL DISTRICTS OF MATATIELE AND MT FLETCHER, EASTERN CAPE (12/3/295 ER) September 2016 SUBMITTED FOR ENVIRONMENTAL AUTHORISATION IN TERMS OF THE NATIONAL ENVIRONMENTAL MANAGEMENT ACT, 1998 (NO. 107 OF 1998) (AS AMENDED) IN RESPECT OF LISTED ACTIVITIES THAT HAVE BEEN TRIGGERED BY AN APPLICATION IN TERMS OF THE MINERAL AND PETROLEUM RESOURCES DEVELOPMENT ACT, 2002 (NO. 28 OF 2002) (AS AMENDED) NAME OF APPLICANT: Rhino Oil and Gas Exploration South Africa (Pty) Ltd TEL NO: (021) 21 412 1577 POSTAL ADDRESS: PO Box 225, Rondebosch, 7701 PHYSICAL ADDRESS: Icon Building, Suite 300, Cnr Long Street & Hans Strijdom Ave, Cape Town PASA REFERENCE NUMBER: 12/3/295 ER PREPARED BY: SLR Consulting (South Africa) (Pty) Ltd DOCUMENT INFORMATION Title ENVIRONMENTAL IMPACT REPORT AND ENVIRONMENTAL MANAGEMENT PROGRAMME FOR AN EXPLORATION RIGHT APPLICATION FOR PETROLEUM PRODUCTS ON VARIOUS FARMS IN THE MAGISTERIAL DISTRICTS OF MATATIELE AND MT FLETCHER, EASTERN CAPE (12/3/295 ER) Status Final for submission Applicant Rhino Oil and Gas Exploration South Africa (Pty) Ltd Project Number 723.18034.00005 Project Manager M Hemming Author J Blood and M Hemming Reviewer J Crowther Client Rhino Oil and Gas Exploration South Africa (Pty) Ltd Date last printed 2016/09/30 03:43:00 PM2016/09/29 04:00:00 PM2016/09/29 03:35:00 PM Date last saved 2016/09/30 03:43:00 PM2016/09/29 04:35:00 PM2016/09/29 03:55:00 PM Keywords Rhino Oil and Gas, Exploration Right, EIA and EMPR Report Number 4 Issue Date September 2016 This report has been prepared by an SLR Group company with all reasonable skill, care and diligence, taking into account the manpower and resources devoted to it by agreement with the client. Information reported herein is based on the interpretation of data collected, which has been accepted in good faith as being accurate and valid. No warranties or guarantees are expressed or should be inferred by any third parties. This report may not be relied upon by other parties without written consent from SLR. SLR disclaims any responsibility to the Client and others in respect of any matters outside the agreed scope of the work. SLR office, Johannesburg, South Africa Physical Address: Unit 7 Fourways Manor Office Park Corner Roos and Macbeth Streets Fourways Johannesburg South Africa Postal Address: PO Box 1596 Cramerview, 2060 Tel: +27 (011) 467 0945 Fax: +27 (011) 467 0978 Web: www.slrconsulting.com SLR Consulting(South Africa) (Pty) Ltd Page iii ENVIRONMENTAL IMPACT REPORT AND ENVIRONMENTAL MANAGEMENT PROGRAMME FOR AN EXPLORATION RIGHT APPLICATION FOR PETROLEUM PRODUCTS ON VARIOUS FARMS IN THE MAGISTERIAL DISTRICTS OF MATATIELE AND MT FLETCHER, EASTERN CAPE (12/3/295 ER) EXECUTIVE SUMMARY 1. Introduction and Background This Environmental Impact Report (“EIR”) and Environmental Management Programme (“EMPr”) have been compiled and were distributed for review and comment as part of the Scoping and Environmental Impact Assessment (hereafter collectively referred to as “EIA”) process that was undertaken for the application by Rhino Oil & Gas Exploration South Africa (Pty) Ltd (hereafter referred to as “Rhino Oil and Gas”) for an Exploration Right (“ER’) for petroleum products on various farms in the magisterial districts of Matatiele and Mount Fletcher, Eastern Cape, South Africa (12/3/295 ER). This EIR summarises the EIA process followed to date and provides an overview of the proposed project and the affected environment. It provides an assessment of the impacts of the proposed project and sets out the recommend management measures. Interested and Affected Parties (“I&APs”) were asked to comment on the EIA and EMPr prior to it being submitted to the Petroleum Agency of South Africa (“PASA”) for decision-making. In early 2015 Rhino Oil and Gas lodged an application for an ER to explore for petroleum products (including oil, gas, condensate, coal bed methane, helium and biogenic gas) with PASA in terms of Section 79 of the Mineral and Petroleum Resources Development Act, 2002 (No. 28 of 2002) (MPRDA), as amended. PASA accepted the ER application on 22 May 2015 (Ref: 12/3/295 ER). The purpose of exploration is to identify the existence of any commercially viable reserves of oil and / or gas. Exploration is a technically complex and iterative process consisting of a number of stages typically termed i) early-phase exploration, ii) appraisal and iii) well drilling. Data from each stage improves the knowledge and understanding of the resource, and informs the following stage, which is only undertaken if results are positive. Exploration can require a period of up to 10 years to inform a decision on a production right application. Rhino Oil and Gas is proposing to only undertake ‘early-phase exploration’ activities. The initial ER application area was approximately 120 000 ha in extent and covered approximately 175 properties (farms and portions) (see Figure 1-1 for the regional setting of the project). The proposed ‘early-phase exploration’ activities as included in the initial ER application were: various non-invasive and remote exploration techniques (including analysis of existing data and full tensor gradiometry gravity survey); the drilling of up to 10 core boreholes; and SLR Project 723.18034.00005 Rhino Oil and Gas - Exploration Right Application: EIA and September 2016 Report No.4 EMP report SLR Consulting(South Africa) (Pty) Ltd Page iv 125 km of seismic survey acquisition. Subsequent to the acceptance of the Scoping Report, Rhino Oil and Gas reduced the extent of the ER application area through the exclusion of the Malekgalonyane (Ongeluksnek) Nature Reserve to an area of 109 292 ha. In addition, Rhino Oil and Gas has excluded the ground-based core hole drilling and seismic surveys from proposed ‘early-phase exploration’ work for which they are seeking environmental authorisation. Thus the current focus of the application and the related environmental assessment work is now only related to the proposed remote exploration techniques (including analysis of existing data and an aerial full tensor gradiometry gravity survey). Exploration activities proposed for this application SLR Project 723.18034.00005 Rhino Oil and Gas - Exploration Right Application: EIA and September 2016 Report No.4 EMP report SLR Consulting(South Africa) (Pty) Ltd Page v If the application is approved, Rhino Oil and Gas would be in a position to conduct the remote exploration and to develop a more detailed understanding of the potential oil and gas resources in the ER area. Thereafter, should Rhino Oil and Gas propose to conduct ground-based exploration activities this would need to be informed by a further application to PASA and a separate environmental assessment and authorisation process. A benefit of this revised approach is that any future application for ground-based exploration activities will be focussed on specified sites, thereby enabling I&APs to know where Rhino Oil and Gas proposes to access land and conduct ground-based exploration activities. The approval being sought as part of this application does not include any activities relating to the appraisal or well drilling phases that comprise a commercial viability assessment of a possible resource, nor any aspect of production. Thus no wells, permeability testing, pressure testing or hydraulic fracturing (commonly referred to as “fracking”) is proposed as part of the initial three-year exploration programme. 1.1 Opportunity to Comment This EIR was distributed for a 30-day comment period from 12 August to 13 September 2016. Copies of the report were made available for download from the SLR website (go to: http://www.ccaenvironmental.co.za/sub-oil-gas-minerals/) and were available in hard copy at the locations described below. An electronic copy of the EIR was emailed or provided on CD on request. The reports’ Executive Summary was also translated into Sesotho and isiXhosa and was available for download from the SLR website or was emailed on request. Location name Physical Address Matatiele Public Library 102 Main Street, Matatiele, 4730 Maluti Magistrate Offices 101 Main Street, Matatiele, 4730 Mount Fletcher Public Library Enkululekweni Location, Mount Fletcher Elundini Local Municipality (Mount Fletcher Offices) 272 Back Street, Mount Fletcher Maclear Public Library Van Riebeeck Street, Maclear, 5480 Bakoena Traditional Council Chief Moshoeshoe’s Office, Queen’s Mercy Ramohlakoana Traditional Council Queen Sibi’s Office, Hebron Bakoena Traditional Council Chief Lebenya’s Office, Seqhobong Amahlubi Traditional Council Chief Zibi’s Office, Ezingonyameni, Kwa Dzingwa 2. Legislative requirements An application for an exploration right requires statutory approval in terms of both the MPRDA and the National Environmental Management Act, 1998 (No. 107 of 1998) (NEMA), as amended. The MPRDA provides that mineral and petroleum resources are the common heritage of all South Africans and that the State, as custodian thereof, is entitled to issue rights to ensure the sustainable SLR Project 723.18034.00005 Rhino Oil and Gas - Exploration Right Application: EIA and September 2016 Report No.4 EMP report SLR Consulting(South Africa) (Pty) Ltd Page vi development of South Africa’s mineral and petroleum resources within a framework of national environmental policy, while promoting economic and social development. Any right granted under the MPRDA is a limited real right in respect of the mineral or petroleum and the land to which such right relates. The holder of a right is entitled to the rights referred to in Section 5 of the MPRDA and such other rights as may be granted to, acquired by or conferred upon such holder under the MPRDA or any other law. Mineral and petroleum rights are however also specific and have limitations in terms of the target resources, included land, the work programme and a timeframe.