Windhoek, Namibia – 25 April 2025: High Finance topped the agenda of day two at the Namibia International Energy Conference 2025, with insights into oil sector merger and acquisition activity, monetising Namibia’s vast gas reserves and fast-tracking crucial infrastructure development which is already accelerating at an unprecedented rate.
The oil discoveries of 2022 brought a landslide change in merger and acquisition activity in Namibia along with a resurgence of cash flow, said Irvin Titus, Bowmans Senior Partner. “This trend is continuing especially as the Orange Basin has become a hot bed of activity and new deals are being structured to align players interests in exploring the basin, “he said, noting that the M&A trend is shifting to the Walvis Bay Basin which was encouraging for further exploration activity.
Another trend is the divestment of late-life, non-core assets and strategic moves in and out of Africa by big oil companies as they merge, said Liz Williamson, Head of Energy at Rand Merchant Bank.
This activity will put assets in the hands of new players, help small existing independents scale up and lead to indigenisation of assets. “I expect to see this continue even given the current volatility because the decisions have been made with the Independent Oil Companies and they will stick with them as long as there is not a massive drop in the oil price, which combined with volatility and lack of clarity from government will freeze M&A activity,” she said.
Small agile independent companies were vital in opening up new exploration frontiers such as Namibia, said Gil Holzman, Chief Executive Officer at Eco (Atlantic) Oil & Gas. These first movers do the derisking groundwork and then the big majors follow and partner in drilling the expensive exploration wells which can cost $50 million to $100 million per well – something that small companies cannot afford.
“This is how the industry works, and it works well in Namibia which has an enabling regulatory structure and officials who understand how the industry works and accommodate the needs of the companies,” he said.
Saying that the role of small companies could not be substituted, Robert Bose, Chief Executive Officer, Sintana Energy cautioned that it was going to be a challenge keeping nimble players active with the onslaught of majors.
For Bose and Adam Rubin, General Counsel, ReconAfrica partnerships rather than mergers or acquisitions were critical.
“The most important drivers of investment are quality partnerships and incentives which enhance our ability to accomplish strategic goals and make an impact in the places in which we are investing,” said Bose.
“Partnerships were a form of knowledge and technology sharing,” said Rubin, adding that “in Namibia we have incredible partners because we have not yet found oil but it is coming because we know it’s there.”
From oil to gas
Turning to Namibia’s vast natural gas reserves the NIEC conversation looked at lessons learnt, solutions and infrastructure.
Ian Thom, Research Director, Upstream Research, Wood Mackenzie, pointed out that Namibia’s focus has been on getting first oil and the Gas Masterplan was competing for attention, but he was expecting this to be developed over the next six to nine months. The strategy should include the market, region, Namibia’s ambitions and the assets, and its success will be in giving operators and investors clarity.
Looking at local content and skills needed, Mtundeni Ndafyaalako, NAMCOR Executive for Upstream Development & Production said that despite the tertiary education there were still not the requisite skills required for the industry. A solution for companies was to hire a Namibian and train them in-house. NAMCOR uses this strategy and after a 12-month training programme a person can be employed as a junior drilling engineer.
He commended operators who have been ready to accommodate the local private sector excluding any legislation. There are obligations under the Petroleum Agreements, so operators don’t have to wait for the local content policy. In terms of ownership NAMCOR has identified a partner once the project has developed sufficiently.
Looking at shared infrastructure, which helps improve economies of projects, it was said that there must be a mechanism to agree with other operators or the government about who will pay for the “delta” of infrastructure for common use.
Incentives were suggested to encourage operators to spend more initially and recover their costs through other mechanisms. While common user infrastructure proved better project economics, it also provided certainty while projects were matured.
Looking at Namibia’s potential markets for gas, Thom said the three main markets for Namibia’s gas were domestic and within that the sector is power, which was the vision for Kudu. The key dynamic was the price along with stability so by providing domestic gas, onshore and building a gas to power plant provided reliability and cost efficiency. With 59% of Namibia being electrified and an ambition to increase this to 100%, domestic gas would have a significant role in achieving that. “A really obvious play for gas-to-power is to displace imports and become an electricity exporter,” he said, pointing out that exporting gas to a regional market was not feasible.
Exporting LNG was an option. Europe and Asia were big gas importers and there was a role to play in Africa for small-scale LNG and Namibia could have a part in this. Paul Eardley-Taylor, Head of Oil & Gas Coverage Southern Africa, Standard Bank said there was a clear opportunity for Namibia to supply electricity to Zambia and other neighbours in time.
Zambia and DRC want to mine critical minerals. The rule is they need 10-12 Gigawatts to do this. Clearly going to have to get his energy from several countries including Namibia. The copper which miners are able to pay in dollars is very attractive. There were also geopolitical benefits for Namibia to become an energy exporter to the region, and assuming the role that South Africa used to have.
Manfriedt Muundjua, Deputy General Manager, BW BW Energy said Namibia needed to develop power to attract industry. Furthermore, the more renewables you want to do the more gas to power will be needed for backup and for Namibia to reach its renewable energy penetration goals.
Muundjua said BW Kudu had undertaken new 3D seismic analyses that have enabled the company to sanction two wells. “We have just concluded our EIA for this appraisal effort and are submitting the report to the authorities; we have purchased all the long-lead items required which will arrive between June and August so we will start earliest around this time and the second well will be drilled in 2026. We are also about to start an EIA for a gas to power plant. ”But before a single molecule is put into a pipeline long term commitments for uptake of the gas are needed.
Ndafyaalako told delegates that NAMCOR had launched a gas monetisation project to support the government and the industry as to how we can monetise the gas. They want to get an indication of all the uses and potential in terms of demand and supply. The most important output would be an ownership model from structure to operation all the way to downstream, and get an indication how much supply of gas is needed and which monetization option we can target.