AEC warns Wild Coast ruling could deter investment in African oil and gas

South Africa’s Constitutional Court has blocked Shell (LSE/NYSE: SHEL) and Impact Africa from continuing offshore oil and gas exploration along the Wild Coast, ending a five-year legal battle over an exploration right granted in 2014. The African Energy Chamber (AEC) criticised the ruling, saying it could weaken South Africa’s energy security and discourage investment in African oil and gas projects.

For the AEC, the ruling raises a broader question about how African countries can develop their resources while addressing legitimate environmental and community concerns.

“Africa cannot afford to leave its natural resources underground while millions of people struggle with energy poverty and unemployment,” said NJ Ayuk, executive chairman of the AEC. “Communities must be heard, but consultation cannot become a permanent veto over responsible development. Lawfare that drives away investment ultimately hurts the very economies and communities it claims to protect.”

The AEC said the ruling comes at a critical time for South Africa’s offshore industry. Major discoveries in neighbouring Namibia have turned the Orange Basin into one of Africa’s leading exploration frontiers, attracting international oil giants including Shell and TotalEnergies (EPA/LSE/NYSE: TTE) and raising expectations for future investment, production and government revenues.

The chamber said South Africa shares the same geological opportunity but faces a more complicated operating environment. It warned that exploration capital could move to countries with clearer licensing rules, more predictable regulation and fewer risks of lengthy legal disputes.

The Wild Coast case also forms part of what the AEC sees as a wider continental trend. The chamber has criticised what it describes as Western-backed “lawfare” against African energy projects, including legal challenges involving the East African Crude Oil Pipeline (EACOP) and opposition to Mozambique’s LNG developments.

The AEC said that governments should enforce environmental standards and ensure communities are consulted, but argued that legal action should not become an indefinite barrier to resource development.

According to the chamber, the issue is particularly important for countries facing energy shortages and the Wild Coast ruling should prompt a wider debate about Africa’s ability to develop its resources according to its own economic needs. More than 600 million Africans still lack access to reliable energy, while many economies depend on imported fuels and are exposed to volatile international prices. The AEC believes that domestic oil and gas development can generate revenues, jobs and feedstock for power generation and industry.

The chamber has called for legislation that provides clear consultation requirements, firm regulatory timelines and predictable investment rules while maintaining environmental safeguards and community participation.

The AEC said it would continue advocating for responsible resource development and a stronger African voice in global energy discussions, including at African Energy Week 2026 and wider COP talks.