Oil and Gas Discovery by Shell in Namibia yet to be determined

Martin Endjala

It is reported that petroleum system presence was discovered offshore the coast in the orange basin of Namibia by Shell.

Senior Public Relations Officer (PRO) in the Ministry of Mines and Energy (MME), Andreas Simon, reiterates that the Ministry is aware what is circulating in the media about the commercial viability in one of Namibia’s offshore coast Graff-1.
However, Simon emphasises the ministries stands, stating that, “operations on the Graff-1 are still on going and NAMCOR has the project objective of the government to safely execute the operations and collect quality data, to enable thorough assessments of the prospects potential.”

Meanwhile, the MME insists that no commercial discovery has been made yet, and that they are not sitting with data to confirm the presence of an active petroleum system. Further assessment is to be done to determine if it is commercially viable or not. The Shell exploration that commenced last year drilling exploration is expected to end in the coming week, only then “will we have more for the public and full result announcement” says Simon. It is estimated to generate about N$ 344 billion dollars for Namibia.

Shakwa Nyambe, an international energy and natural resources lawyer, echoes the MME stating, that it is exciting times for Namibia indeed, but cautions Namibians. “We need to wait for the official confirmation from both NAMCOR and Shell, the extent of commercial discovery.” Nyambe quickly points out that Namibia has stringent environment and biodiversity laws, which has been consistently applied in sectors such as fishing, mining and petroleum. The Namibian petroleum sector has even more stringent environmental legal requirements and approvals than any other sector in the country like the Environment Management Act of 2007 amended, Environment Impact Assessment Regulations Act of 2011 and Petroleum Exploration and Production Regulations Act of 1991. The lawyer continues that “he government makes 50 percent benefit from each petroleum license upon discovery of commercial petroleum, outlined from applicable legislation Petroleum income tax of 35 percent” dispelling misconceptions surrounding Government, that it only gets ten percent from upstream petroleum projects in Namibia, stating that there is no true in it.

The Government has control of its economic and social benefits, from the petroleum extraction as contained in petroleum (exploration and production act No.2 of 1991) as amended. Petroleum taxation act No. 3 of 1991. Due to this regulatory bodies, approvals are then based upon this, implementing applicable biodiversity laws, thus protecting the ecosystem and the country’s economy, says Nyambe.
Shell has for long been successfully developing energy projects worldwide, and has been present in Namibia since 2014. It has control interest of (45) percent in petroleum exploration license 39(PEL39) and Qatar petroleum has (45) percent while, the National Petroleum Corporation of Namibia (NAMCOR) ten. Shell has done three seismic surveys of PEL 39 between 2014 and 2019 thus far. These involves identifying geological structures below the seabed to see if there is commercial oil or gas. The use of Sensors is to monitor wells in real-time, to enable engineers and geologist onshore operations to identify any potential risks and respond immediately as part of their safety measures.


By Observer