Tom Alweendo, Chief Executive Officer of Alvenco Advisory, has warned that associated gas should not be treated as an afterthought if volumes from Namibia’s offshore oil discoveries prove to be significant.
He stressed the need for early planning around gas handling, domestic demand and potential regional export routes in order to preserve flexibility and avoid costly mistakes later in the development cycle.
“Associated gas deserves special discipline. If gas volumes are material, we should not treat gas as an afterthought. Early planning is needed on gas handling, domestic demand options and possible regional routes. The point is to preserve options and avoid locking into a costly path that later proves wrong,” Alweendo said.
His comments come as Namibia’s offshore oil discoveries face a key challenge to full-scale development due to high levels of associated gas, according to global consultancy Wood Mackenzie.
Recent discoveries, including Venus operated by TotalEnergies, Graff and Jonker operated by Shell, and Mopane operated by Galp, are oil-led but have high gas-to-oil ratios. This means substantial volumes of gas are expected to be produced alongside crude oil.
Public estimates from Namibian authorities and industry partners suggest that several trillion cubic feet of gas have been discovered to date in the Orange Basin, in addition to the long-known non-associated Kudu gas field further north.
Wood Mackenzie Research Director for Sub-Saharan Africa Upstream Ian Thom said in April that while Namibia has emerged as one of Africa’s most closely watched 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,” Thom said.
A key issue, he explained, is the high gas content in offshore fields such as the Venus discovery, particularly when compared with deepwater projects developed by ExxonMobil 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 said.
TotalEnergies has already initiated the environmental approval process for the development of the Venus field. Current plans involve reinjecting associated gas back into the reservoir through subsea wells, rather than transporting it to shore via pipeline.
Thom said that while gas reinjection is common in frontier deepwater developments, including in Guyana, relying on this approach over the long term could create challenges, such as 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 said.
Uncertainty around gas handling is not limited to TotalEnergies. Galp, the operator of the Mopane discovery, has yet to outline its strategy for managing associated gas.
Thom also noted that Namibia’s reliance on imported electricity could make gas-to-power projects attractive, although questions remain about scale and feasibility.
“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 asked.
He added that involving third-party players in midstream operations introduces further complexity, particularly around partnership structures and counterparty risk.
