Namibia considers incentives to expedite TotalEnergies’ offshore development

(Bloomberg) — Namibia will offer financial incentives to help kick-start the development of oil fields managed by a group led by TotalEnergies, according to a special adviser in the presidency.

TotalEnergies and Shell Plc in 2022 made the first in a series of finds off the coast of the southwest African nation. But the explorers have also hit dry wells, prompting them to write off drilling costs as they learned more about the fields.

“The government recognizes the complexities and high costs associated with the development of the Venus oil field by TotalEnergies,” Kornelia Shilunga, special adviser and head of upstream petroleum unit in the Namibian Presidency, said in a reply to questions.

The state is “exploring mechanisms to enhance financing options, such as credit support instruments and partnerships with international lending institutions, to address challenges faced by local enterprises in accessing capital,” she said.

Namibia is targeting first oil output in the next five years, as it seeks to become a producer before crude demand is overtaken by low-carbon and renewable sources of energy.

State oil company Namcor is looking to build capacity to have a bigger role in developments along with the country’s strategy to maximize local production, according to Shilunga, who was appointed last month.

Namibia is also evaluating the potential to hold licensing rounds to increase activity, she said.