Source: Namibia Economist
The Minister of Mines and Energy, Hon Tom Alweendo announced that the decision for multi-national oil and gas company Shell to write down N$400 million on the Orange Basin oil discovery, will not significantly impact Namibia’s oil and gas exploration scenario.
Alweendo said this is not a setback. “We are positive that the remaining potential of PEL 39 and other exploration campaigns will translate into commercial developments. Shell’s discoveries in Pel 39 represent just some of the many exploration milestones witnessed offshore Namibia since 2022,” he added.
He explained that the discoveries were considered commercially unfeasible, with Shell citing technical and geological challenges. “However, together with their partners Qatar Energy and NamCor, Shell will continue to explore potential commercial pathways to development, while actively looking for further exploration opportunities in PEL 39,” he continued.
Alweendo stated that since the initial discovery at the Graff-1-X well in 2022, Shell has drilled eight wells at PEL 39, with various wells encountering hydrocarbons. “While initial assessment of some of the subsurface parameters indicated challenges related to subsurface complexities and reservoir quality, there is significant potential for improvement as exploration and technical analysis continues,” he emphasised.
Furthermore he said the collective discoveries from the nine drilled wells amount to significant volumes of hydrocarbons accumulations. “We remain committed to developing these discoveries, which are believed to be commercially viable. We are dedicated to progressing these opportunities with the right partner and right investment commitment,” he reassured.
He said for example TotalEnergies is making progress with their multi-well appraisal and exploration drilling campaign in Block 2913G, situated in PEL 56 and they aim to make a Final Investment Decision this year, with first oil targeted for 2029. “Concurrently, Galp seeks to bring in another partner on the Mopane complex, following two discoveries at the Mopane-1X and its successful appraisal in Mopane-2A well in 2024,” he said.
Alweendo stated that the Mopane complex in PEL 83 alone has been cited having the potential to contain significant volumes of hydrocarbons in place. “Rhino Resources, in partnership with Azule Energy, NamCor and Korres Investment, are busy drilling the first of the two high impact wells at PEL 85 currently, while Petrobras is seeking farm-in opportunities offshore. At the same time, drilling activities are under way for the Kapana 1X well by Chevron and its joint venture partners NamCor and Trago in PEL 90.”
He said these investments signal a strong commitment by leading international oil companies to unlock the full potential of Namibia’s offshore acreage, while the Shell write down is unfortunate, the Ministry believes that they have barley begun to scratch the surface of the country’s offshore resources. “We will continue to work with dedicated companies to develop these resources and our plan to first oil are still on track. We remain confident that ongoing exploration efforts will reveal commercial opportunities and look forward to delivering first oil production in the near future,” concluded Alweendo.
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