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Despite a recent $400 million write-down by Shell on its offshore oil discoveries, the Namibian government remains steadfast in its commitment to developing the country’s hydrocarbon potential.
Shell, facing technical and geological challenges in extracting resources from its PEL39 block, determined that the discovered oil and gas were not currently viable for commercial development. This announcement, while a setback, has not dampened the Namibian government’s enthusiasm for its burgeoning oil and gas sector.
“We are dedicated to progressing these opportunities with the right partner and right investment commitment,” the Ministry of Mines and Energy declared in a statement. “Shell’s decision will not significantly impact Namibia’s oil and gas development.”
The Ministry acknowledged the inherent challenges in offshore exploration, citing the complexities of subsurface formations and reservoir quality. However, they emphasized the potential for advancements in technology and further geological studies to unlock the full potential of these resources.
“We are positive that the remaining potential of PEL39 and other exploration campaigns will translate into commercial developments,” the Ministry stated.
The Namibian government pointed to other promising developments, including TotalEnergies’ ongoing appraisal and exploration drilling campaign in Block 2913B. TotalEnergies, aiming for first oil production in 2029, is expected to make a final investment decision this year.
Furthermore, the Ministry highlighted the potential of the Mopane complex and other discoveries within the Walvis Basin. “While the Shell write-down is unfortunate, the Ministry of Mines and Energy believes that we have barely begun to scratch the surface of the country’s offshore resources,” the statement read.
The Namibian government remains committed to working closely with dedicated companies to capitalize on these opportunities and bring Namibia’s oil and gas ambitions to fruition. The country’s burgeoning energy sector holds immense potential to transform the nation’s economy and secure its energy future.
