Article from Business Express

On the back of major oil and gas discoveries in recent years, Namibia’s upstream oil and gas sector is on the precipice of rapid transformation.

Significant discoveries made in the southern African country’s Orange Basin in 2022 and 2023 – which include the Graff-1, Venus-1, and Jonker-1X exploration projects –, compounded by favorable fiscal incentives, have attracted oil and gas supermajors including TotalEnergies, Shell, Chevron and ExxonMobil, as well as multinational energy corporations such as Galp and QatarEnergy.

Namibia made its third significant oil discovery in the Orange Basin in early-March 2023, with Shell and QatarEnergy having successfully drilled the Jonker-1X exploration project, leading to increased exploration and appraisal activities in the country. According to the country’s National Oil Company (NOC) Namcor, light oil was discovered 270km offshore using the Odjfell Deapsea Bollsta semi-submersible rig in Blocks 2913A and 2914B, which are situated in the Petroleum Exploration License (PEL) 39.

Meanwhile, TotalEnergies is currently engaged in a multi-well appraisal and exploration drilling program in Block 2913B, situated in PEL 56 in the Orange Basin, following the discovery of light oil in the ultra-deepwater Venus-1 exploration well in March 2022. Covering an area of approximately 8,215km2, the Venus-1 well encountered a high-quality light-bearing sandstone reservoir in water depths of approximately 3,000m, roughly 290km off the coast of southern Namibia.

Rounding off Namibia’s recent series of massive discoveries, the Graff-1 exploration well, situated 270km from the town of Oranjemund, southwest Namibia, was drilled by Shell using the Valaris DS- 10 drillship in December 2021 to a total depth of 5,376m. Situated in the PEL 39 license area, drilling operations were completed in February 2022, yielding an estimated 2,000 to 3,000 barrel per day (bpd) flow potential.

On top of the country’s immense offshore potential, oil and gas exploration company ReconAfrica announced in June 2023 an updated prospective resource estimate of 22.4 trillion cubic feet of natural gas in Namibia’s onshore PEL 73 license area in the Kavango Basin. The update is based on ReconAfrica’s strategy to fast-track acquisition and processing of an additional 1,100km2 2D seismic program over the country’s Damara Fold Belt play, which was initially discovered during the first phase of 2D seismic acquisition in 2021.

As a result of these major discoveries, the Government of Namibia has sought to engage multinational firms to compete for multi-billion-dollar projects in the country. While still in the exploration stage, the southern African country is poised to benefit from its immense hydrocarbon potential through the exploration and development of oil and gas fields, its transportation and storage, and eventual refining of petroleum products for export to international markets.

Petroleum affairs and the country’s upstream sector is overseen by its Ministry of Mines and Energy, which is responsible for the initiation of policy and legislation for hydrocarbon exploration in Namibia’s on- and offshore acreages. Meanwhile, Namibia’s NOC has emerged as a world-class petroleum organization, providing sustainable benefits to stakeholders operating in the country.

As such, in May 2023, Galp inked a contract for a semi-submersible rig to be used for an initial exploration drilling campaign close to Shell’s Graff and TotalEnergies’ Venus discoveries. Projected to commence operations by Q4 2023, the contract will include well testing and a drilling program in PEL 83, tapping into the unmatched hydrocarbon potential of the Orange Basin and driving Namibia’s potential as an upcoming major oil and gas player in the southern African region.

In all, an estimated 11 billion barrels of oil reserves have been discovered offshore Namibia, which puts the country on par with its northern neighbor Angola, a country that serves as sub-Saharan Africa’s largest oil producer. Hampered by a lack of exploration efforts until recent years, Namibia has largely been overlooked by oil majors, however, recent discoveries in the offshore Orange and onshore Kavango Basins suggest that the country is due for a significant oil boom in the coming years.

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