Namibia: black gold as the engine of an ambitious economic future

It is off the southwest coast of Namibia, in the Orange Basin, that one of the most promising chapters in the country’s economic history is being written. Between 2022 and 2024, several exploratory drillings conducted by TotalEnergies, Shell, and Galp Energia revealed significant offshore oil reserves. According to the Namibian Ministry of Mines and Energy, proven reserves currently amount to more than 11 billion barrels of oil equivalent. TotalEnergies’ Venus-1X well alone holds 5.1 billion barrels, while Shell is focusing on the Graff-1X and Jonker-1X blocks, with 2.38 and 2.5 billion barrels respectively, according to RFI. Galp, for its part, announced in January 2024 that its Mopane field could contain up to 10 billion barrels, of which approximately 2.5 billion could be exploited as early as 2028 (Africa Intelligence, 2024). These figures place Namibia among the select group of oil powers on the continent, behind Nigeria, Angola, Algeria, and Libya.

An Ambitious Goal: 500,000 Barrels/Day by 2035

The economic stakes are enormous. According to projections from the Ministry of Finance, Namibia could generate annual oil revenues of $5 to $7 billion by 2040 almost half of its current GDP, estimated at $12.6 billion in 2023 (World Bank, 2023). The country aims to reach a daily production of 500,000 barrels by 2035, which would place it fifth in Africa in terms of output. This goal is considered credible by the International Energy Agency (IEA), which notes growing interest from international investors in this politically stable and sparsely populated region (2.7 million inhabitants).

Oil Majors Proceed with Caution

Despite the prevailing enthusiasm, oil majors remain cautious. TotalEnergies plans a Final Investment Decision (FID) on the Venus-1X project for 2026, with production expected to begin in 2030 at an initial rate of 150,000 barrels per day well below the government’s optimistic forecasts.

Shell and Chevron, meanwhile, have recently revised downward the profitability outlook of some explored wells. According to internal reports cited by Africa Oil & Gas Report, the presence of associated gas, offshore logistical costs, and the need for infrastructure development are delaying decision-making.

Namibia seems aware of the risks. Experts often speak of the “resource curse,” a situation in which resource-rich countries see their growth hindered by corruption, conflict, or poor governance. Nigeria is the most emblematic example: despite 60 years of oil production, more than 40% of its population lives below the poverty line (UNDP, 2022).

Angola experienced rapid growth thanks to oil, reaching an 8% annual growth peak between 2005 and 2013, but failed to equitably distribute the oil rent. By contrast, Namibia is already considering governance mechanisms inspired by the Norwegian model. A sovereign wealth fund is expected to be established by 2026 to capitalize on oil revenues and finance social, health, education, and infrastructure projects.

“We want every Namibian to benefit from this wealth, not just the elites,” declared Tom Alweendo, former Minister of Energy, during an energy forum in Windhoek in September 2024.

Lessons from Guyana and the Growing Role of the State

Guyana, a small South American country, is a more recent model. Thanks to ExxonMobil, it became a producer of over 400,000 barrels per day in less than five years. It established a Natural Resource Fund, controlled by Parliament, and negotiated a balanced revenue-sharing agreement with foreign companies.

Namibia is already drawing inspiration from this. A minimum local content requirement has been imposed by the government in oil contracts (jobs, local subcontracting, technical training). In 2024, a petroleum engineering training school was opened in Walvis Bay, supported by TotalEnergies and the University of Namibia.

This energy boom comes at a time when the transition to renewable energy is accelerating. Namibia, which has committed to reducing its greenhouse gas emissions by 91% by 2030, will have to balance its fossil fuel ambitions with climate obligations (Paris Agreement, NDC 2021).

Some experts, such as those at Novethic, believe that this new extractive model must necessarily be accompanied by an economic diversification plan. Agriculture, tourism, and green hydrogen (already under development) could offset a future decline in global oil demand.

Namibia’s oil emergence is arguably the most significant economic transformation the country has experienced since its independence in 1990.