Via News24, an article on two new oil discoveries in Namibia:

Two oil discoveries offshore of Namibia are likely to bring in an equivalent R53 billion in revenues for the state, a prominent global consultancy group has estimated.

In early February, Shell and its partners announced they had made a significant oil discovery at its Graff-1 well in the deep waters off the coast of Namibia in the Orange Basin.

On Thursday, TotalEnergies and partners announced that another giant oil discovery at its Venus well, which is also located in the ultra-deep waters, not far from Graff-1. With a conservative estimate of over three billion barrels recoverable oil volumes, a report by global consultancy Wood Mackenzie says the find is “set to become Sub-Saharan Africa’s biggest-ever oil discovery” and Namibia could find itself the third-largest oil producer in the region within a decade.

The group estimates that if both projects proceeded in tandem, it could, at peak production, bring in over $3.5 billion (~R53.5 billion) annually in royalties and taxes for the government.

The two are also estimated to attract a cumulative $29 billion (~R443 billion) in investment – triple the size of Namibia’s GDP in 2020.

However, the development of Namibia’s oil won’t be without challenges, especially in light of increasingly negative sentiment toward fossil fuels.

Namibian civil society groups have already cautioned that the discovery will have a negative impact on the local fishing and tourism industries. They are also sceptical whether the oil industry will indeed provide local jobs in a country with no real expertise in oil and gas.

A low carbon development will be key for TotalEnergies, Wood Mackenzie said.  

“Venus’ associated gas could displace diesel power generation, which accounts for 30% of the country’s grid-connected supply. But equally, it could complicate the development in such deep water and with an under-developed gas market. A more regional solution may be required.”

Through its national petroleum company, Namcor, the Namibian government holds a 10% interest in both discoveries. While the discoveries present a huge opportunity for the country, it will need to be pragmatic, the report said. “Despite where oil prices are today, the energy transition is here and Namcor’s partners will want to progress quickly.”