Namibia demands reciprocal oil commitment
Namibia has pledged to maintain predictable rules and timely decision-making for oil and gas investors, but says companies will also be expected to honour their commitments on investment, performance and conduct as the country prepares to develop its offshore discoveries and targets domestic production by 2030.
Vice President Lucia Witbooi said the transition from exploration to development would require Namibia to strengthen its institutions, regulatory framework, infrastructure and domestic capabilities, while ensuring that international investment creates economic value extending well beyond offshore oil production.
Speaking at the official opening of the Namibia Oil and Gas Conference in Windhoek on Wednesday on behalf of President Netumbo Nandi-Ndaitwah, Witbooi said discoveries in the Orange Basin had transformed Namibia's global energy profile and attracted major international energy companies and investors.
The Venus and Mopane discoveries were shifting the national conversation from exploration towards development and production, while recent exploration results from Shell's Merlin-1X well in PEL 0039 had provided further evidence of the basin's geological potential, she said.
However, Witbooi cautioned against treating discoveries themselves as Namibia's measure of petroleum success.
"Discovery is not the destination. A resource beneath our waters becomes a national success only when it is responsibly developed and translated into tangible improvements in the lives of our people," she said.
"It must become employment for Namibians, opportunities for our enterprises, skills for our young people, technology for our institutions, infrastructure for our economy, revenues for national development and savings for future generations."
She said decisions on field development, procurement, infrastructure, financing, technology, skills, taxation, environmental management and partnerships would ultimately determine how much of the value generated by petroleum Namibia retained and multiplied.
The state must prepare for development
Witbooi said Namibia now needed to move from "resource optimism to disciplined execution" as offshore projects advanced towards potential development.
That would require stronger institutions, greater regulatory certainty, improved infrastructure and logistics, a competitive domestic supplier base and a workforce prepared for the technical demands of the industry. The state itself would also need greater capacity.
Namibia had to ensure that the government possessed the capability to "negotiate, monitor and manage increasingly complex petroleum operations", she said.
Witbooi said the government's objective was not simply to attract foreign capital, despite acknowledging that international capital, technology and expertise would be essential to developing complex deepwater resources.
"We welcome international capital, technology and expertise because these are essential to developing complex deepwater resources. But partnership must be reciprocal," she said.
