Shell will fast-track appraisal drilling on its latest offshore Namibia oil discovery after encountering better reservoir quality and fluid characteristics than previous exploration wells, raising hopes the find could support a commercial development.
Speaking during Shell’s second-quarter 2026 results presentation, Chief Executive Officer Wael Sawan said the company’s latest discovery in the Orange Basin had delivered the best reservoir properties seen so far within the licence area, marking a significant step forward in its Namibia exploration programme.
“On the exploration well we were indeed pleased with the result of that well. Again, early days, but what I would say is the biggest difference is in both the reservoir and the fluid characteristics. It was one of the best permeabilities and porosities that we had seen in the block and it’s opened up a new horizon for us to explore,” said Sawan.
Shell plans to drill two appraisal wells before the end of 2026 to better define the size of the discovery and determine whether it contains sufficient recoverable volumes to justify commercial development.
“We’re now looking to expedite two appraisal wells to end of this year to be able to allow us to de-risk some more volumes and see whether we have enough for an attractive, profitable development. More to come, I suspect, in 2027,” said Sawan.
The latest update follows Shell’s announcement in June that the Merlin-1X exploration well in Petroleum Exploration Licence 0039 (PEL 0039), operated by Shell in partnership with QatarEnergy and NAMCOR, had delivered the most promising subsurface results recorded on the licence to date.
The Merlin-1X well, which was spudded on 8 April 2026, is the tenth exploration well drilled in PEL 0039.
Shell said the well successfully penetrated the Coniacian play, encountering good-quality reservoirs containing light oil with limited associated gas, representing an improvement over previous discoveries in the licence area.
At the time, Shell Executive Vice President for Exploration, Strategy and Portfolio Eugene Okpere said the results strengthened the company’s understanding of the Orange Basin and supported continued evaluation of the resource’s commercial potential.
“These are encouraging results that add to our understanding of the Orange Basin potential. We are progressing this opportunity through a disciplined, data-led approach to establish commerciality, focusing our investment on options that are material, competitive and resilient within our portfolio. This is built on strong partnership and alignment, and I thank the Government of the Republic of Namibia, our partners and all teams involved,” said Okpere.
The planned appraisal campaign is expected to provide additional geological and reservoir data needed to determine whether the discovery can be developed commercially, with further updates anticipated in 2027.
