Oil major Shell, which is conducting appraisal work on PEL-39 to determine the commercial viability of the hydrocarbon, has cautioned that first oil from its discovery in Namibia is unlikely before 2030.
This comes as Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director, confirmed that a successful flow test was conducted on its Graff discovery offshore Namibia, with all Namibian probes being ‘top quartile’, according to Upstream.
In March, Shell and its partners announced a significant discovery of light oil in the Jonker-1X deep-water exploration well, located approximately 270 kilometres off the Namibian coast in the offshore region.
The PEL-39 Exploration License is held by a consortium comprised of QatarEnergy (45% working interest), Shell (Operator with 45% working interest), and the National Petroleum Corporation of Namibia (NAMCOR) (10% working interest).
Shell Namibia Upstream B.V. has already entered into a N$1.7-billion contract extension with Northern Ocean for continued work using the Deepsea Bollsta.
The contract extension runs from December 2023 to June 2024 and includes an additional option for six months at a cost of N$1.6 billion.
Earlier this month, NAMCOR announced its anticipation of the country commencing oil production by 2029.
Namibia is optimistic about the future economic prospects of the country following the discovery of oil by Qatar Energy, Shell, and Total Energies in the Orange Basin, offshore Namibia near Luderitz.
According to government estimates, the Shell and Total Energies discoveries could generate annual taxes and royalties ranging from N$60 billion to N$95 billion, with the potential to create 3,600 jobs at the peak of production.
