Shell says it is still monitoring developments in Namibia’s oil sector, but the country is no longer one of its top priorities for exploration spending, as the company adopts a more cautious and focused global approach.
Speaking on Shell’s revised exploration strategy, CEO Wael Sawan said the company is now being selective about where it invests, and Namibia is not currently on the list of areas where major new funding is being directed.
“Of course you know we have Namibia. There we are looking at what others are doing, continuing to learn and positioning ourselves in case something interesting comes up,” Sawan said.
Shell has shifted focus to areas where it already holds assets and has a proven track record, such as the Gulf of Mexico, Malaysia and Oman.
The change follows a major reset of the company’s exploration department.
“I think our exploration programme is right at the moment. We went through a significant reset of our exploration department capability because the hard truth is while we have had some good progress in certain areas it hasn’t delivered what we had wanted,” Sawan said.
Shell operates the PEL 39 licence off Namibia’s southern coast, which covers 12,000 square kilometres.
Since the Graff-1X discovery in 2022, the company has drilled nine wells in the block, including Graff, Jonker and La Rona. Some of these have encountered hydrocarbons, but Shell says technical and geological challenges prevent confirmation of commercial viability at this stage.
The company has already written down around US$400 million related to one of the discoveries.
Shell holds a 45% stake in the licence, alongside QatarEnergy with 45% and Namcor with 10%.
“We have some exciting wells coming in the next I’d say six to 12 months which I’m looking forward to seeing what we come out of that, while always recognising of course exploration we play the long game,” Sawan said.
This comes as a delegation from Shell led by Eugene Okpere, Shell’s Executive Vice President for Exploration Strategy, Portfolio, Integrated Gas, and Upstream,last month met with President Netumbo Nandi-Ndaitwah to discuss the company’s ongoing activities and future plans in Namibia’s oil exploration sector.
