Policy gaps delay Namibia’s first oil
Policy uncertainty, inadequate infrastructure, and the failure to finalise local content frameworks may curtail Final Investment Decisions (FID) in Namibia’s burgeoning oil sector. Research firm Simonis Storm said these "above-ground" risks persist despite demonstrated geological potential.
Between 2021 and 2025, more than 15 offshore wells were drilled across Blocks 2913B and 2913A by majors including TotalEnergies, Shell, Galp, Chevron, Rhino Resources, and BW Kudu.
While geological results remain encouraging—with the Venus discovery frequently referenced in the 2–3 billion-barrel recoverable range—the firm said FIDs have been repeatedly delayed.
“This alone signals that technical success does not automatically translate into commercial execution. The constraints are increasingly ‘above ground.’ Infrastructure readiness, port capacity, energy and water security, fiscal stability, regulatory clarity, local content structuring, and cost control now represent the binding constraints,” Simonis Storm said.
The firm said Namibia’s policy architecture remains incomplete. It noted that key elements—such as a legislated sovereign wealth framework, transparent revenue management, updated petroleum legislation, and comprehensive local content regulations—require consolidation and certainty to reassure investors.
The scale of potential revenue
Despite these hurdles, Namibia stands to benefit significantly if production begins. Under a phased Floating Production Storage and Offloading (FPSO) scenario, Simonis Storm said production could ramp up around 2029–2031 at approximately 120,000–150,000 barrels per day (kb/d).
Higher-bound basin development could see peak output reach 350,000–380,000 kb/d in the mid-2030s. At 350,000 kb/d and a price of US$70 per barrel, Simonis Storm said annual gross revenue could approach US$9 billion (approximately N$170 billion).
Even under a conservative scenario of 150,000 kb/d at US$60 oil, gross revenue could reach N$60–70 billion annually.
Using the Venus case as an illustration, Simonis Storm said that at US$60 per barrel, the government's take could include:
Royalties: US$3 per barrel
Petroleum Income Tax (PIT):
US$11.20 per barrel
Additional Profits Tax (APT): US$5.20 per barrel
This implies a total government take of roughly US$19–20 per barrel. At a production rate of 300,000 kb/d, Simonis Storm said this could translate into N$35–40 billion in annual fiscal receipts. Under peak conditions, revenue could exceed N$50 billion; however, more conservative scenarios may see it remain closer to N$15–20 billion.
For context, Simonis Storm said Namibia currently collects approximately N$12–15 billion in total company tax annually. The firm said that while the potential fiscal uplift is massive, it remains far from automatic.
