… TotalEnergies opts to reinject associated gas at Venus find
Namibia’s promising offshore oil discoveries face a significant hurdle to full-scale development due to high levels of associated gas, according to global consultancy Wood Mackenzie.
Ian Thom, Wood Mackenzie’s Research Director for Sub-Saharan Africa Upstream told a recent event that while Namibia has become one of Africa’s most talked-about oil frontiers, the development of its offshore resources is likely to be more complex than initially anticipated.
“Namibia is one of the most talked-about topics in Africa, and we receive more questions about it than almost any other region. There’s no doubt that Namibia is hugely exciting. But from a development perspective, Namibia does present more challenges,” said Thom.
A key concern, he explained, is the high gas content in offshore fields such as the Venus discovery operated by TotalEnergies, especially when compared with similar deepwater projects in Guyana.
“If you look at the gas ratio in Venus compared to some of the projects ExxonMobil has developed in Guyana, Namibia has roughly double the gas content,” Thom noted.
TotalEnergies has already initiated the environmental approval process for the development of the Venus field. Current plans reportedly involve reinjecting the associated gas back into the reservoir via subsea wells, rather than transporting it to shore via pipeline.
“The approach that TotalEnergies is taking in its current application is for gas to be reinjected, and I don’t see any mention of a gas pipeline to shore. That appears to be the current concept,” Thom said.
While reinjection of gas is not unusual in frontier deepwater projects—Guyana being a case in point—Thom cautioned that relying on this method over the long term could lead to complications, including increased gas recycling and a rising gas-to-oil ratio.
“If you just keep reinjecting gas, you can get gas recycling effects and a continuing increase in the gas-to-oil ratio. It may be that there’s a gas development five to ten years down the road,” he added.
The uncertainty around gas handling is not limited to TotalEnergies. Galp, the operator of the Mopane discovery, has yet to announce its strategy for managing associated gas.
Thom also pointed out that Namibia’s dependence on imported electricity could make gas-to-power projects an attractive option. However, questions remain about the scale and feasibility of such an approach.
“What’s the magnitude of that? Is what you’re able to deliver enough? Is the market able to absorb all the associated gas, or do you still need to reinject some of it?” he queried.
He further noted the challenges of involving third-party players in midstream operations, highlighting the risks associated with complex partnerships and counterparties.
Despite the hurdles, industry optimism remains strong, driven by discoveries such as Venus, Graff, and Mopane.
However, Namibia’s deepwater locations, high gas content, and lack of infrastructure are likely to prolong the development timeline.
“In Guyana, they reached first FID (Final Investment Decision) within 25 months, but in Namibia, development is likely to take longer due to these added complexities,” Thom said.
Nevertheless, Wood Mackenzie maintains a positive outlook for Namibia’s oil future.
“The resources are certainly there, and at least a couple of projects look very promising for FPSO development in the relatively near term. We’re continuing to watch Namibia very closely and remain actively engaged,” he said.
