Shell Commits Over N$1 Billion to Namibia's Energy...

Shell Commits Over N$1 Billion to Namibia's Energy Sector

Zim Now Writer

Global energy giant Shell has reaffirmed its long-term commitment to Namibia’s energy sector, announcing that it has invested more than N$1 billion in oil and gas exploration activities in the country.

The confirmation came during a high-level courtesy call by Shell’s Executive Vice President for Exploration, Strategy and Portfolio, Integrated Gas and Upstream, Eugene Okpere, to President Netumbo Nandi-Ndaitwah.

Okpere emphasized Shell’s intention to remain a key partner in Namibia’s offshore oil and gas ambitions, citing the country as a strategic frontier for exploration despite the technical and commercial challenges the company has faced. “Namibia holds promising potential,” he said, noting that Shell continues to evaluate new investment opportunities in the region.

President Nandi-Ndaitwah welcomed the reaffirmed commitment and applauded Shell for aligning its investments with the nation’s development agenda. “Your continued presence supports our vision of transforming Namibia into a regional energy hub and ensuring that natural resources benefit our people,” she said.

Shell’s renewed pledge comes just months after a significant financial blow in its Namibian operations. In January 2025, the company wrote down approximately US$400 million linked to an oil discovery in Block PEL39, after deeming the find commercially unviable.

Despite drilling nine wells since 2022 in partnership with QatarEnergy and Namcor, Shell cited geological challenges—such as high natural gas content and poor rock permeability—that made extraction technically complex and financially unattractive.

Shell CEO Wael Sawan called the acreage “very challenging,” highlighting the difficulties of developing the block within acceptable commercial thresholds.

The write-down served as a sobering reminder of the risks tied to frontier oil exploration, even in regions with high expectations.

Despite the PEL39 setback, Namibia remains a rising star in African oil exploration. Recent offshore discoveries by Galp Energia and TotalEnergies have reinvigorated global interest, positioning the country as a potential energy powerhouse.

Shell’s continued investment of over N$1 billion is a strong signal that the company sees long-term value in Namibia’s offshore basins.

Analysts view this as a calculated strategy that prioritizes future returns over short-term profit, particularly as the government works to improve investor confidence through regulatory reforms and infrastructure upgrades.

For Namibia, Shell’s presence remains a critical component of its broader energy aspirations. The government is keen to ensure that international investments translate into tangible socio-economic benefits—especially job creation, infrastructure development, and local value addition.

Shell’s approach—balancing caution with optimism—reflects the volatile but potentially transformative nature of offshore oil development. While setbacks like PEL39 serve as cautionary tales, the renewed commitment demonstrates the enduring interest of major global players in Namibia’s energy sector.