You have news tips, feel free to contact us via email editor@thevillager.com.na

Namcor Makes N$114 Million After-Tax Profit


By:Justicia Shipena
The National Petroleum Corporation of Namibia (Namcor) made an after-tax profit of N$114 million in fiscal year 2021/2022, according to itsjust released annual report.
“Namcor made an after-tax profit of N$114 million for the period under review, compared to a loss of N$133 million in the previous financial year,”said Managing Director Immauel Mulunga, who is currently under suspension.
According to the report, financial performance showed an incremental increase in certain key operational measures, despite considerable financial problems.
Namcor’s financial challenges, according to the company, are mostly attributable to narrow margins that are insufficient to absorb all of its operating costs, as well as the ever-changing dynamics of global market oil prices.
Despite this, the state-owned entity maintains its year-on-year revenue grew from petroleum products in the downstream sector and data sales in the upstream sector.
In this regard, Namcor achieved total revenue of N$2.88 billion during the period under review, compared to N$1.33 billion in the preceding year.
“This represents an increase of 115%. Gross profit margins also recovered during the financial year, from a negative gross profit margin of N$1.4 million in the previous financial year to a positive gross profit margin of N$221 million,”the company stated.
Namcor’s operating expenditures increased as a result of business expansion, says the report.
Namcor stated that the group’s financial position is improving, with the overall asset base expanding by 60% from the 2020/2021 to the 2021/2022 fiscal year.
“The increases are mainly attributable to the capitalisation of retail service stations, appreciation in equity investments and the acquisition of inventory from international markets on a larger scale,” Namcor explained.
The company evaluated and modified its strategy in terms of income streams for upstream exploration derived from licensing of upstream technical data and monetary considerations from farming-down of participation interests in petroleum exploration licences (PELs).
This process resulted in the identification and prioritisation of the acquisition of one PEL, farm-out (block dilution), and generate cash consideration of about N$28,1 million, generate data sales revenue of N$15 million, and partner with leading players in broadband seismic technology with the goal of improving subsurface analysis accuracy and skills transfer.
According to Namcor, TotalEnergies and Shell’s finds of light oil in the two wells Venus-1X and Graff-1 affirm the deep-water Orange Basin’s huge potential and firmly establish it as one of the world’s most promising oil prospects.
“Namibia as an emerging hydrocarbon exploration province in the world,” the report states.
The preliminary total values of Graff-1 and Venus-1X to the investor are anticipated to be US$8.1 billion, providing the Namibian government with a future undiscounted cash flow of US$44.9 billion.
“These initial estimates show that Graff-1 and Venus-1X have the potential to double the Namibian GDP by 2040 to close to US$37 billion,” the company says.
Namcor says the combined resources of the two oil discoveries may sustain a project producing 400,000 barrels per day (bbl/day) and potentially creating over 3,600 jobs at peak.
A Namcor-commissioned studyanticipated that a total investment of more than US$12 billion, which is more than Namibia’s GDP in 2020 (US$10.7 billion), would be necessary, and that the combined field could generate more than US$5.6 billion in taxes and royalties for the government yearly at peak production.
“The resulting economic boost will encourage further oil and gas investment, and play a pivotal role in accelerating the development and decarbonisation of other industries such as mining, agriculture, fishing and tourism.”
Graff and Venus are two of the top twenty global oil finds made in the recent decade.
As the industry has far more barrels than is required, only the best barrels with the lowest costs, lowest carbon emissions, and greatest economics will reach the market. Graff and Venus are considered as advantageous resources as a result of these factors.
As a result, Namcor stated that these discoveries are highly valued and will be strategically placed in the portfolios of both Shell and TotalEnergies.
Namcor disclosed that revenue from licensing upstream technical data amounted to about N$30,24 million against a budget of N$15 million, representing a 97% increase over the data sales revenue objective.

Justicia Shipena

Related Posts

Read Also ... x