One of the world’s newest exploration hotspots, Namibia is considering what additional financial alternatives and incentives it could provide to foreign majors planning to produce oil off the African nation.
Oil majors like Shell, TotalEnergies, and Galp, have made major discoveries on along Namibia’s offshore region.
However, industrial development plans cost more when there is no infrastructure in place.
In order to help the super majors achieve final investment choices on certain oil production projects, Namibia aims to provide them with additional incentives in the hopes of becoming the next Guyana.
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Kornelia Shilunga, special adviser and head of the Namibian Presidency’s upstream petroleum unit, told Bloomberg that the government is aware of the difficulties and significant expenses involved with TotalEnergies’ development of the Venus oil field.
According to the official, Namibia examines financing options such as collaborations with foreign lending organisations and credit support tools.
To draw majors and increase activity, the nation also thinks about staging license rounds for oil and gas.
According to a senior official last month, Namibia anticipates that TotalEnergies and BW Energy of Norway would make final investment choices on oil projects by the end of 2026.
According to Maggy Shino, Petroleum Commissioner at the Namibian Ministry of Mines and Energy, BW Energy and Namibia are completing a plan to develop a smaller find, while Total Energies is anticipated to submit a field development plan for the Venus project this summer.
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International majors have been flocking to Namibia’s offshore in recent years, anticipating that it could become the next Guyana and a significant producer and exporter of oil.
Nevertheless, Shell recently suffered a $400 million loss due to an oil discovery in Namibia’s offshore block PEL39 that “cannot currently be confirmed for commercial development.”
At the company’s Q1 earnings call, TotalEnergies CEO Patrick Pouyanné stated that talks have begun between Namibian authorities and the company over a potential development of the Venus finding. He added that if the project matches the rate of returns the company has established, the super major could proceed with it.
