Namibia Refuses to Recognize TotalEnergies Oil Acquisition

The Namibian government will not recognize an asset acquisition deal involving TotalEnergies and Petrobras because they did not follow procedure. In a statement on Sunday, the country’s Ministry of Industries, Mines and Energy said, as quoted by Reuters, that TotalEnergies and Petrobras had not notified it of their intentions to acquire a 42.5% each in the PEL104 offshore license and had therefore failed to secure the formal approval of the government for the acquisition. “The government makes it clear that in accordance with the law, any transfer, assignment, or acquisition of participating interests in petroleum licenses in Namibia must obtain prior approval of the minister,” the ministry said. TotalEnergies said on Friday it had signed agreements to buy a 42.5% operated interest in the PEL104 exploration license offshore Namibia from Eight Offshore Investments Holdings and Maravilla Oil & Gas. Upon completion of the transaction - if the Namibian government gives the supermajor its blessing - TotalEnergies will be the operator of the license, which lies north of the PEL 83 license of the giant Mopane discovery. The French supermajor will own a 42.5% interest alongside Petrobras 42.5%, Namcor 10%, and Eight 5%. Earlier, TotalEnergies completed a stake swap deal with Portugal’s Galp, under which the French company would get a 40% operating stake in the block containing the Mopane discovery—one of the most promising ones in recent years—and Galp would get 10% in the block with the Venus discovery and 9.39% in a third block, PEL91. Namibia hopes to become the next Guyana, but it lacks the infrastructure to fast-track the discoveries, which makes them more expensive and difficult to develop and monetize. Still, the oil industry appears ready and willing to make the necessary investments to secure future production from new deposits that would serve to replace mature assets entering the depletion phase. By Irina Slav for Oilprice.com