“The Namibian government was not notified about these developments, as required by law.”
TIRI MASAWI
The fate of a deal between TotalEnergies and Galp Energy to take control of some of Namibia’s largest oil blocks now rests with the Minister of Industries, Mines and Energy, Modestus Amutse.
The agreement, announced last week, would see French giants TotalEnergies take a 40% operating stake in Petroleum Exploration Licence (PEL) 83, which holds the Mopane discovery, while Portugal-based Galp Energy would acquire a 10% participating interest in PEL 56, home to the Venus discovery.
The two offshore discoveries are among the most significant oil finds along Namibia’s coastline in recent years.
The deal comes as the ministry was blindsided, only learning of the transaction at the eleventh hour.
The Presidency said on Monday that the transaction is not final and will only be recognised once the minister has made a determination in line with the law.
Presidential spokesperson Jonas Mbambo told Namibia Business Review that the reported deal cannot be regarded as concluded at this stage.
“At this stage, the reported deal cannot be regarded as concluded. The final determination rests with the competent authorities once all legal and regulatory requirements have been satisfied,” Mbambo said.
He said the minister will decide whether the agreement meets licence requirements, regulatory approvals and industry expectations.
“Any transaction involving the transfer, assignment or acquisition of participating interests in a petroleum licence is subject to the Petroleum (Exploration and Production) Act, 1991, as well as applicable licence conditions,” he said.
TotalEnergies last week announced the conclusion of the agreement with Galp to enter as operator in the prolific PEL 83 licence, including the Mopane discovery.
In its statement, the company said the transaction positions TotalEnergies as operator of the two largest oil discoveries in Namibia and opens the way for the development of a major producing hub aimed at generating long-term value for the country and its partners.
However, Mbambo said Namibian authorities must first determine whether the proposed transaction complies with local laws.
“The role of the authorities, as regulator and custodian of Namibia’s natural resources, is to assess any such application in accordance with the law, licence obligations, and the national interest. Only after this process has been duly followed can a decision be made on whether to approve, conditionally approve, or decline the transaction,” he said.
He emphasised that amendments to petroleum licences require written approval from the minister. Until a formal application is submitted and the prescribed statutory process is completed, no transaction can be recognised or considered valid.
INSIDE THE DEAL
TotalEnergies chairperson and chief executive officer Patrick Pouyanné said the company is eager to continue building in collaboration with the Namibian authorities to deliver both developments.
“We are very happy to have been selected by Galp as their partner and operator for the prolific PEL 83 licence, including the Mopane discovery in Namibia. This is a strong recognition of the exploration and deepwater competences of TotalEnergies teams,” Pouyanné said.
He added that the transaction demonstrates TotalEnergies’ confidence in Namibia as a future oil-producing country and that the company will leverage its operatorship track record to progress towards profitable and sustainable developments of both the Venus and Mopane discoveries.
According to Pouyanné, the aim is to achieve synergies that will create long-term value for Namibia and stakeholders.
Under the agreement, TotalEnergies will carry 50% of Galp’s capital expenditure for the exploration and appraisal of the Mopane discovery and the first development on PEL 83. The carry will be repaid through 50% of Galp’s future cash flows from the project.
The two companies have agreed to launch an exploration and appraisal campaign, including three wells over the next two years, with the first well planned for 2026. The programme is intended to further derisk resources and advance the development of the Mopane discovery, according to TotalEnergies.
After completion of the transaction, TotalEnergies will hold a 40% operated interest in PEL 83 alongside Galp (40%), Namcor (10%) and Custos (10%). It will also hold a 35.25% operated interest in PEL 56 alongside QatarEnergy (35.25%), Galp (10%), Namcor (10%) and Impact (9.5%), and a 33.085% operated interest in PEL 91 alongside QatarEnergy (33.025%), Namcor (15%), Galp (9.39%) and Impact (9.5%).
MINISTRY RAISES CONCERN
In a statement released on Friday, the Ministry of Industries, Mines and Energy said it had noted the deal with concern.
“The ministry wishes to clarify that the Namibian government was not notified about these developments, as required by law. Indeed, the ministry was informed of the planned press release a few minutes prior to its release by the aforementioned parties,” the ministry said.
The ministry said that, in accordance with the law, any transfer, assignment or acquisition of participating interests in petroleum licences in Namibia must obtain prior approval of the minister.
“The ministry remains steadfast in its commitment to regulatory compliance, transparency, and the responsible development of Namibia’s petroleum resources,” the statement said.
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