Namibia and South Africa have become focal points for new discoveries and exploration and are driving significant Merger and Acquisition (M&A) activities, according to petroleum experts.
The is especially the case within the Orange Basin, where both Shell and TotalEnergies have announced world-class deliveries this year, writes Paul Sinclair, the Vice President of Energy and Director of Government Services of Green Energy Africa, in an opinion piece.
He says that risk appetite in West and Central Africa is relatively down, but is considerably higher in frontier basins in Southern Africa. ‘’This is particularly the case in Angola (Namibe and Kwanza Basins), Namibia (Kavango, Walvis Bay and Orange Basins) and South Africa (Orange Basin) but also in Zimbabwe (Cabora Cassa Basin).
‘’In January, Eco (Atlantic) Oil & Gas acquired Azinam in a bid to enter Blocks 3B/4B and Block 2B within the Orange Basin offshore South Africa, and to consolidate its interests in its four existing licenses within the Walvis Basin offshore Namibia,’’ Sinclair says.
Southern Africa, he says, is slowly imposing itself to many buyers ‘’as the region offers the right mix of producing assets, exploration blocks in frontier basins and a supportive business environment’’.
Angola which is one of the oldest oil producing countries on the continent after substantive reforms since 2017 has brought back investors into the country’s producing and exploration blocks.
Following the reforms in support of M&A activity in exploration and producing assets, Sonangol, the country’s state owned oil company, embarked on partial divestment from some of its oil assets.
Namcor was announced as one of the successful bidders for Sonangol’s exploration and producing blocks in Angola, when it tendered for the blocks.
Announcing its new acquisitions, the company said ‘’Namcor has reached its target of acquiring producing assets’’.
For block 23 which is already in exploration, Namcor was selected together with Sequa and Petrolog with a combined 40 percent stake and Afentra taking another 40 percent. In Block 27, Namcor, Sequa and Petrolog hold a 35 percent stake with Somoil and Sirius with 25 percent.
Sinclair says: ‘’In fact, Angola is one of the very few oil producing markets that is supporting M&A activity in exploration assets. Such deals are notably driven by Sonangol’s partial divestment process, which has already attracted the interests of Afentra in Block 23 (Kwanza Basin) and of the consortium of Angolan independent Somoil and British independent Sirius Petroleum in Block 27 (Namibe Basin).’’
Namibia on its part, last month hosted the Namibia International Energy Conference in Windhoek, which was attended by international, local and regional energy experts, which was described as ‘’a timely and opportune platform for the continent’s energy sector influencers, professionals, thought leaders, investor and industry experts’’.
Namibia is not only a petroleum frontier country, following its recent oil find off its coast, and the country’s drive to become a renewable energy hub through its flagship green hydrogen project, is another plus for it to attract investors, in greenfield energy projects.