Galp Energia will need a partner to develop a prolific oil find in Namibia

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  • Reuters reports that Galp Energia will need a partner to develop a prolific oil find in Namibia as it is “beyond its financial means” to keep an 80% stake in the exploration block that includes the Mopane field, CEO Filipe Silva said on Tuesday.
  • Sources told Reuters last week that Galp has launched the sale of half of its 80% stake in the exploration block.

Galp (80%, operator), together with its partners NAMCOR and Custos (10% each), has successfully completed the first phase of the Mopane exploration campaign with the conclusion of the Mopane-1X Well Testing operations. The company said last week that it had completed the first phase of exploration in the Mopane field and estimated it could have at least 10 billion barrels of oil.

The Mopane-1X well discovered, in January, significant oil columns containing light oil in high-quality reservoir sands at two different levels: AVO-1 and AVO-2. The rig then moved to the Mopane-2X well location, where in March significant light oil columns were discovered in high-quality reservoir sands across exploration and appraisal targets: AVO-3, AVO-1 and a deeper target. In particular, the Mopane-2X well found AVO-1 to be in the same pressure regime as in the Mopane-1X discovery well, around  8 km to the east, confirming its lateral extension.

The reservoirs log measures confirm good porosities, high pressures and high permeabilities in large hydrocarbon columns. Fluid samples present very low oil viscosity and contain minimum CO2 and no H2S concentrations. The flows achieved during the well test have reached the maximum allowed limits of 14 kboepd, potentially positioning Mopane as an important commercial discovery. In the Mopane complex alone, and before drilling additional exploration and appraisal wells, hydrocarbon in-place estimates are 10 billion barrels of oil equivalent, or higher.

We will prioritise a partner that is keen to quickly develop the prospects and that will fund the capex,” Silva told a conference call with analysts.

“We are confident that Namibia will bring another exciting growth avenue to Galp,” the CEO said, adding that the Mopane complex “is going to be a multiple vessel-based production and storage platforms (FPSO’s) development” that would require tens of billions of dollars, which “is not expected to be funded by Galp”.

“It is critical the market understands that when we start with (a stake of) 80%, we have a lot of leeway to go down, be diluted over time and bring somebody else to fund the project,” he said.

Author: Bryan Groenendaal


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