An inter-governmental committee formulating a Namibian content policy for the burgeoning oil and gas industry has made local content development in the country a priority. The National Upstream Petroleum Local Content Policy, currently in draft format, aims to improve Namibian participation in the sector and boost the domestic supply chain, while continuing to welcome international investment and contribution.
The vision of the draft Namibian Content Policy is to develop an internationally-competitive supply chain in the country, maximising output, while making Namibia a preferred investment destination and hub for oil and gas goods and services.
A statement issued yesterday by the mines and energy ministry noted the local content policy is poised to drive socioeconomic development, resource monetisation and sustainable growth.
The ministry stated that the policy has been devised to safeguard equity and inclusion in the oil and gas industry, while ensuring it is beneficial for all parties involved. For this reason, the National Upstream Petroleum Local Content Policy is being expedited, and will be ready for approval soon. The draft policy aims to ensure effective national stewardship in the oil and gas industry, prioritising the role of local industry players and stakeholders in all operations associated with the sector.
“The draft policy outlines a pathway for Namibian citizens and companies to benefit from our natural resources by increasing their participation in the oil and gas industry, from exploration and production, and throughout the entire industry’s value chain,” stated mines and energy minister Tom Alweendo. “We, at the ministry, are striving to enact the framework to create an internationally-competitive petroleum sector that maximises the benefits for our people and leverages our natural resources for broader national development. We are laser-focused on achieving a balance between increasing local participation and attracting foreign investment,” he added.
Key tenets of the draft policy include sustainable resource development, energy independence and economic diversification; ensuring in-country resource wealth retention, and adherence to global environmental standards. Furthermore, the policy aims to promote social inclusion, job-creation and meaningful equity participation in service companies by previously disadvantaged Namibians, guaranteeing in-country processing through robust infrastructure development and public enterprise investments.
In addition, the Namibian Content Policy aims to establish a stable, transparent regulatory framework for Namibian Content, making it a criterion for permits, licences and contracts with strong institutions for enforcement.
The plan also seeks to leverage Namibia’s recent success in the oil and gas exploration arena as well as promote the transfer of technology, knowledge and skills to Namibians.
“International interest and participation in the country is poised to enable higher-value roles and collaboration with industry stakeholders to promote skills development and local value retention,” the ministry stated.
It continued that the policy also aims to facilitate meaningful participation and financing for Namibians and SMEs at all levels of the oil and gas value chain, ensuring broad sharing of resource development benefits and innovative financing mechanisms.
“We are at the dawn of an energy revolution that will transform our economy. Discoveries in the Orange Basin suggest the biggest oil yield ever found in sub-Saharan Africa, and there’s still so much to discover, both in the Orange Basin and in other locations, which is why we must act proactively now. We must seize the opportunity to implement policies that will protect investors and Namibia’s best interests when it comes to our natural resources,” Alweendo said.
The ministry further noted it is moving with all deliberate speed to commence various stakeholder consultations and other engagements to revise the draft policy that will best serve the country, its people and investors.
“The policy reflects the government’s desire to leverage its recent oil and gas discoveries for broader national development, with a focus on achieving a balance between local participation and attracting foreign investment. The country’s foray into oil and gas is poised to reignite the economy by encouraging new investment, and revitalising the manufacturing sector. At the same time, a proactive introduction of solid Namibian content regulations will no doubt foster job-creation, help combat energy poverty, and promote hope and human dignity for the Namibian people,” the ministry stated.
Oil exploration and discoveries
On the back of a major exploration blitz in Namibia’s offshore in recent years, involving the Graff-I, Venus-I, Jonker-1X, La Rona-I and Lesedi-1X discoveries, the country’s oil and gas sector is on the precipice of rapid transformation. This is because the sector has attracted interest from oil and gas supermajors including TotalEnergies, Shell, Chevron and ExxonMobil, as well as multinational energy corporations such as Calp and QatarEnergy. Also, ReconAfrica’s recent spudding of the Naingopo exploration well, drilled in partnership with the National Petroleum Corporation of Namibia (Namcor), is expected to yield positive results and lead to a multi-well exploration drilling campaign on PEL 73.
This year, Woodside Energy entered an exclusive option with Pancontinental Energy to acquire a 56% participating interest in PEL 87, which is anticipated to result in the development of the licence area’s first exploration well.
Meanwhile, Rhino Resources, which recently entered a farm-in agreement with Azule Energy, awarded Halliburton a contract for its deep-water multi-well construction project in Block 2914A, aligning with the companys’ strategy to leverage local and international expertise to expedite Namibia’s oil and gas industry expansion. This year, Namcor and Chevron also entered an agreement granting the major an 80% operating interest in PEL 82, under which Namcor and Custos Energy will maintain a carried interest.