* South Africa struggles to kickstart offshore exploration

* Multiple wells delayed due to court action, other appeals

* Permits can take up to 5 years, scaring off investors

* Neighbouring Namibia seen as less risky destination

By Wendell Roelf

CAPE TOWN, July 31 (Reuters) - The Orange Basin petroleum

province shared by Namibia and South Africa has become a test

case for how African states balance the demands of oil companies

and local groups, with billions of dollars in investment, jobs

and tax revenues at stake.

The province has made Namibia a global exploration hotspot,

pushing for first oil by 2030 and expected to initially produce

around 150,000 barrels per day via TotalEnergies'

Venus project. South Africa has yet to unlock similar reserves.

Two events in June highlighted the widening gap between how

the two countries are handling the basin's development.

On June 9, Shell put out a statement describing a

new find offshore Namibia as having the "most promising

subsurface results to date" in petroleum exploration licence 39,

home to multiple promising wells since 2022 including the

country's first major oil discovery Graff-1X.

A week earlier, in a packed Cape Town courthouse,

environmental groups and fishing communities launched a bid to

overturn a permit allowing TGS to conduct offshore

seismic surveys in South Africa's area of the basin.

Environmental groups and local communities have launched at

least four court cases and numerous other appeals against South

African offshore ventures and proposed onshore liquefied natural

gas projects since 2021, according to eco-justice group Green

Connection.

That has delayed up to 10 wells expected to be drilled by

2030, South Africa's petroleum regulator PASA said.

"We cannot explore, we cannot spend money in a geography if

we have to face courts permanently and the permitting becomes

really too complex," TotalEnergies CEO Patrick Pouyanne said

during October's results presentation when asked about South

Africa and Namibia.

PERMITS CAN TAKE UP TO FIVE YEARS TO SECURE IN SOUTH AFRICA

Formed millions of years ago when South America broke away

from Africa, the Orange Basin is named after a river that drains

into the Atlantic Ocean along the border of South Africa and

Namibia.

In South Africa, where around two-thirds of the basin lies,

non-governmental organisations and environmental activists have

taken a more aggressive approach to contesting projects in

extractive industries compared to Namibia, with varied success.

Current regulations there, which cut across different

ministries, allow for wide-ranging internal appeals against

environmental and social impact assessments, as well as judicial

reviews in court, whose outcomes can then also be appealed.

Industry body the Offshore Petroleum Association of South

Africa says exploration permits can take up to five years to

secure in South Africa, compared with three to nine months in

other African countries.

"A similar route of long delays threatens to frustrate South

Africa should there be any discoveries," OPASA spokesperson

Niall Kramer said.

TotalEnergies has acquired acreage along South Africa's west

coast and aimed to drill its first exploration well this year,

but its plans are now uncertain.

COMMERCIAL INTERESTS VS COMMUNITIES

Attention is now focused on a ruling, potentially later this

year, from South Africa's highest court that could make getting

offshore exploration permits easier, or more onerous.

The case, first launched in 2021, concerns a challenge by

environmental groups and local communities to a Shell-led

seismic survey along the tourism-dependent Wild Coast.

Among other things, the court is expected to determine

whether commercial interests can outweigh the rights and dignity

of coastal communities, environmental lawyer Ricky Stone said.

"This judgment will be one of the most significant

precedents in South African environmental and constitutional law

in a generation, whatever the Constitutional Court decides," he

said.

Shell declined to comment, citing its close period ahead of

earnings.

'WE DRILLED AND NOTHING HAPPENED'

Although some South African politicians advocate renewables,

petroleum minister Gwede Mantashe backs oil and gas development

and supports industry calls for specialised courts to handle

energy disputes.

South Africa's west coast has offered glimpses of potential,

including the Ibhubesi gas field, estimated to contain about 540

billion cubic feet of gas and 4.3 million barrels of condensate.

A well drilled by Eco Atlantic Oil & Gas ( ECAOF ) in 2022,

Gazania-1, also found light oil-associated gases - but not

enough to develop.

"We drilled and nothing happened," Eco Atlantic CEO Gil

Holzman told Reuters.

"So, we are living proof that one can actually drill in the

basin, leave the surface untouched, and it had zero negative

impact on the local communities, zero impact at all on the

environment," he said.

Outside the courtroom in Cape Town last month where the TGS

case was being heard, Stanley Young, a 65-year-old small-scale

fisherman from Port Nolloth, disagreed.

"The ocean provides for us for generations and we must

protect it," he told Reuters. "If oil and gas comes in here, it

will destroy our livelihoods completely."