By: Kelvin Chiringa
The National Petroleum Corporation of Namibia (Namcor) has scored a major success by being granted an oil exploration and producing licence in Angola.
The license has effectively added Namcor to the list of oil producers, while the company will partner with Angola’s Sonangol.
Group Sonangol is a parastatal that oversees Angola’s petroleum and natural gas production.
“This is a big deal for Namcor as it will immediately transform us into an oil-producing company, and it will generate significant revenues and profits and increase the balance sheet of exploration and our production subsidiary.
“We are very excited by the tender awarded to us by Sonangol to participate in several of their blocks and portfolio. One of the blocks is 15/06 as well exploration blocks which are blocks 23 and 27 respectively,” said Namcor.
Mines ministry economist, Abednego Ekandjo, also said that the Namcor breakthrough would mean enhanced revenue, which will translate to sizeable cash flows inside Namibia from Angola.
“That means money will be flowing into the country. And if Namcor can make good profits, they will obviously be expected to pay a dividend to government,” he said.
Namcor’s royalties to the Angolan government will hinge on what deal it will have reached with its partnering company, Sonangol, said Ekandjo.
“It will all depend on the deal; how the contract between Sonangol has been structured. So, you will have to go into the intricacies of that deal to find out exactly how each party will be benefiting. I think Namcor and Sonangol are putting capital resources together to start producing from Angolan oil blocks,” he said.
Namcor has been aggressive in diversifying its business portfolio from fuel stations and now ventures into oil exploration and production, creating a business dichotomy of upstream and downstream activities.
At the back of this, Namcor announced the discovery of oil in the south a few months ago, which spurred the nation into a debate on how much of this resource should be squarely in Namibian hands.
The discovery was made by TotalEnergies which in this instance is the operator with a 40 per cent working interest, alongside QatarEnergy (30 per cent), Impact Oil and Gas (20 per cent) and state-owned NAMCOR (10 per cent).
“This offshore discovery in Namibia and the very promising initial results prove the potential of this play in the Orange Basin, on which TotalEnergies owns an important position both in Namibia and South Africa,” Kevin McLachlan, TotalEnergies’ senior vice president for exploration, said in a statement at the time.
