The first exploration for shale gas in South Africa will begin in the next financial year, the government said on Tuesday, following years of postponement.
"One area of real opportunity for South Africa is the exploration of shale gas," the statement said.
"Exploration activities are scheduled to commence in the next financial year. This will lead to excellent prospects for beneficiation and add value to our mineral wealth."
Delays in awarding exploration licenses and lower oil prices led to firms such as Royal Dutch Shell pulling back a year ago on planned shale gas projects in the onshore Karoo Basin.
Shale gas refers to natural gas that is trapped within shale rock, that can be rich sources of petroleum and natural gas.
The shale gas production was previously uneconomical. The use of combination of horizontal drilling and hydraulic fracturing has allowed access to large volumes of shale gas which led to a big increase in production which brought US gas prices to the lowest level in last ten years, in April 2012.
However, there are some environmental drawbacks of production, regarding water supply.
The drilling and fracturing of wells requires large amounts of water. In some areas of the country, significant use of water for shale gas production may affect the availability of water for public use, and also the aquatic habitats can be affected.