DESPITE skepticism about the latest oil discovery announcement, Namibia’s Petroleum Commissioner, Immanuel Mulunga says the announcement by HRT on the non-commercial oil is the beginning of “good things for Namibia”.
Namibia’s quest to find viable fields has been delayed after Brazilian oil company HRT confirmed that they have discovered oil which is not suitable for commercial use.
Mulunga says they did not expect HRT to find oil in their first drill attempt, adding that the findings were more of a teaser and people can expect more valuable discoveries.
He told The Namibian that the country can expect more serious international exploration offers, adding that the announcement was the “kind of news we were expecting for so long”.
HRT President of Exploration and Production, Joe Paul yesterday announced at State House that they found discovered oil which is not for commercial use on their first exploration.
“A multi-well offshore program in Namibia has found oil although not in commercial volumes,” Paul said as some ministers and delegates present at the State House ceremony started clapping in gesture of victory.
HRT began their offshore oil and gas drilling in Namibia in April this year, a move which made the international company’s stock price jump more than 19% in Sao Paulo trading.
That gain was reversed after Reuters reported yesterday that HRT’s shares have fallen more than 90% from an all-time high in 2011 after its other main project – a joint venture with Russia’s state-owned NK Rosneft AO in Brazil’s Amazon – found natural gas but no significant quantities of oil.
According to Paul, the main objective of the exploration was to test the resource potential, adding that the reservoir quality is much less developed than originally expected.
HRT is the operator of 10 blocks offshore Namibia, which are contained in four petroleum licenses.
The businessman says HRT collected four samples of the oil, and each of these samples indicated the presence of light oil with minimal contamination.
He added that no water-bearing zones were identified in the drilled section,” Paul said.
The well is currently in the process of being plugged and abandoned.
He added that the latest results will provide important information that will them in the next exploration steps in the Walvis Basin.
Local businessman Knowledge Katti was with Paul and the chief financial officer of HRT Martin Thomas Davis when the announcment was made. Government was represented on the podium by Prime Minister Hage Geingob and Mines and Energy Minister Isak Katali.
Geingob was standing in for President Hifikepunye Pohamba who was in town but “just out of the office”.
The quest for oil and gas in Namibia has been ongoing for nearly four decades, but with little or no success so far.
There are question marks however over the motives behind the announcement as some senior politicians in the ruling party were unclear on why the event was held at State House while Pohamba was not present.
Some sources opined that the move is aimed at improving the reputation of Geingob who is tipped to take over from Pohamba if he wins next years year’s presidential elections.
“Calling ministers was an exaggeration, especially for oil that has no commercial value. And the President was not at State House. So why have a press conference there?” asked a source from the ruling party.
Minister Katali yesterday warned that people should not be over-excited as this was just one of the stages of exploration for oil. Like Mulunga, the Energy Minister was, however, optimistic that “the face of Namibia will totally be different” after the process is done.
Geingob who has followed the progress of HRT since their launch three years ago congratulated the Brazilian company which for the past 60 days splashed N$810 million into the process of finding oil.
The quest to find oil is set to continue, and Katti said the next phase of drilling will be done in two weeks’ time.
It is not the first time that an oil discovery was made in Namibia.
Minister Isak Katali told Parliament in 2011 there was data showing that Namibia might be sitting on nearly 12 billion barrels of oil and gas and the ministry had to prepare itself for “rigorous” drilling”.