By Mutindi Lydia Jacobs
Namibia is carving a unique path in the global energy landscape, poised to become a leader in green hydrogen production while simultaneously developing its oil and gas sector.
This energy mix approach transcends a mere balancing act, but rather embodies a strategic alignment that capitalizes on the nation’s abundant natural resources, geographical advantages, and dedication to sustainable development.
The concept of a hybrid energy model is not novel on a global scale, with nations such as the United Arab Emirates (UAE), Canada and Australia actively engaged in oil production while simultaneously promoting green hydrogen as an alternative energy source. An energy mix approach aims to diversify the sources of energy generation to enhance energy security, promote sustainability, and mitigate risks associated with relying heavily on a single energy source. By incorporating various forms of energy such as fossil fuels and renewable energy sources, Namibia can achieve a more balanced and resilient energy system.
Namibia’s Green Hydrogen Potential
Namibia has gained international attention for its ambitious National Green Hydrogen Strategy of 2022, which aims to harness the country’s unique mix of wind and solar resources to provide a stable supply of low-cost, clean power for hydrogen production. The vision is to establish a green hydrogen production hub that can supply both domestic needs and export markets. Namibia aspires to produce up to 300,000 tons of green hydrogen annually by 2040, targeting Europe and Asia, which are increasingly shifting towards hydrogen as a clean energy source.
Beyond green hydrogen itself, Namibia is positioning itself to produce and export hydrogen derivatives such as ammonia, methanol, synthetic kerosene, and hot-briquetted iron. The sector is expected to attract significant foreign investment and create thousands of jobs, contributing to the country’s economic diversification and expanding its energy mix.
The Emerging Oil and Gas Sector
Concurrently, the oil and gas industry in Namibia is experiencing significant growth, propelled by recent discoveries of offshore reserves in the Orange Basin. Although the country has yet to commence production of oil or gas, major industry players such as TotalEnergies and Shell have reported findings that are estimated to contain approximately 2.6 billion barrels of oil along with the validation of an operational petroleum system onshore by Reconnaissance Energy Namibia.
Synergies Between Green Hydrogen and Oil & Gas
The emergence of both the fossil fuel and green hydrogen sectors in Namibia raises pertinent questions regarding the potential conflicts between renewable and non-renewable energy sources.
While some scholars contend that the extraction of oil and gas and green hydrogen production is inherently contradictory, I posit that these two sectors can indeed complement each other through meticulous strategic planning and targeted investment initiatives. The potential for both green hydrogen and fossil fuels to be employed in a variety of applications, such as electricity generation, heating, and the propulsion of vehicles and industrial processes, indicates a significant nexus between these two energy sources:
1. Common user infrastructure (CUI): By sharing infrastructure like pipelines and ports, which serve both green hydrogen and oil and gas, the sectors can reduce costs, enhance competition, and minimize redundancy in infrastructure development. This shared use of physical assets yields benefits not only for industrial stakeholders but also for local communities and the government. Additionally, it contributes to the reduction of land use, thereby safeguarding the environment.
2. Financial Resources and Investment Diversification: The revenues derived from fossil fuel exports may be reinvested into the advancement of green hydrogen technologies and associated infrastructure. Oil and gas companies typically have substantial financial resources, which can be leveraged to invest in green hydrogen projects. Their established capital markets access allows them to fund large-scale renewable energy projects necessary for green hydrogen production. By investing in electrolyzers powered by renewable energy sources, oil and gas companies can diversify their portfolios while contributing to decarbonization efforts.
3. Carbon Capture and Storage (CCS): Oil and gas companies have expertise in carbon capture, utilization, and storage (CCUS) technologies, which are crucial for producing blue hydrogen (hydrogen produced from fossil fuels with captured carbon emissions). This expertise could support Namibia’s transition to green hydrogen by minimizing emissions during production.
4. Job Creation: Both sectors have the potential to create significant employment opportunities. While oil and gas projects can offer immediate job prospects, the green hydrogen sector promises long-term jobs in renewable energy, technology, and innovation. A skilled workforce trained in both sectors could ensure that Namibia meets its energy demands while fostering sustainable development.
5. Research and Development Synergies: The collaboration between the oil and gas industry and green hydrogen initiatives may promote innovation through collaborative research and development activities. The technical proficiency of oil companies in refining processes can significantly improve the efficiency of electrolyzers utilized in the production of green hydrogen.
6. Regulatory Support and Energy Transition Strategy: Governments worldwide are implementing policies aimed at promoting clean energy transitions, including incentives for green hydrogen production. Oil and gas companies can benefit from these regulatory frameworks as they pivot towards greener alternatives while still leveraging their existing operations. Namibia has the potential to implement a transitional energy strategy that facilitates the gradual reduction of fossil fuel reliance while simultaneously increasing the production of renewable energy sources. This method not only alleviates possible opposition from environmental organizations but also establishes Namibia as an innovative nation dedicated to harmonizing economic development with sustainability.
Challenges Ahead
Notwithstanding the potential synergies between green hydrogen and oil and gas production, Namibia may still encounter significant obstacles in achieving its dual energy objectives. These include environmental impact concerns, technological inefficiencies, economic viability concerns and integration complexities.
The establishment of a coherent regulatory framework that interrogates these complexities and supports both sectors without compromising environmental standards is therefore paramount. Furthermore, it would be judicious for the government to adeptly navigate the dynamics of international markets, ensuring that investments in the oil and gas sector do not eclipse the pressing requirement for green initiatives.
The nexus between oil and gas and green hydrogen industries is evident in government policy which aims to optimize the advantages derived from its oil and gas discoveries while simultaneously ensuring that such endeavors do not jeopardize future sustainability, by promoting investments in renewable green hydrogen. The Honourable Mr. Tom Alweendo, Minister of Mines and Energy, has articulated Namibia’s stance as one that supports a hybrid energy model.
This model seeks to integrate both fossil fuels and green hydrogen, thereby promoting a balanced and sustainable energy portfolio. The deployment of these resources is intended to facilitate the development of Namibia for the benefit of its citizens, with a particular focus on fostering an equitable and sustainable future for all.
*Mutindi Lydia Jacobs – Chief Legal Officer at the Directorate Law Reform-Ministry of Justice and GH Legislative Focal Person. I am also an Advisory Board Member of the Namibian Youth Energy Forum.
