- French oil major TotalEnergies has delayed its final investment decision on its Namibian offshore oil discovery to 2026 from the previously targeted end of 2025.
- The announcement was made by its CEO Patrick Pouyanne on Wednesday at a press briefing.
The oil giant initially targeted production of 160,000 barrels a day which has now been revised down to 150,000 barrels per day. The discoveries in Namibia have been complicated by a high amount of gas that will make development more expensive. The company said it is struggling to achieve breakeven at under $20 per barrel, an internal requirement for final investment decision.
Last month Shell announced that their exploration of an offshore oil discovery in Namibia is commercially unviable for development. The write down relates specifically to the offshore block PEL 39 in the Orange Basin close to South Africa which was discovered by Shell and its partners, QatarEnergy and the national oil company of Namibia, in 2022. Shell drilled nine wells in the license in the past three years but found significant geological and technical challenges that hindered the development of these resources.
Shell’s CEO Wael Sawan mentioned in an update that the development of the acreage would be extremely challenging. The lower permeability of the rock in this region made the process of hydrocarbon extraction significantly difficult. Furthermore, the company noted that these discoveries have a high proportion of natural gas, making the extraction process even more complicated.
Related news:Â GALP will need a significant partner to develop their Namibia oil and gas concession
TotalEnergies announced a significant find around the same time as Shell in Namibia. Their concession relates to block 2913B which lies next to the Shell’s failed PEL 39 block. Read more
Chevron has also declared its initial findings in Namibia commercially unviable.
The recent announcements come as a major setback for Namibia that is looking to establish itself as a crude producer.
Author: Bryan Groenendaal
