Investment climate
KEY FACTS:
GDP: US$9.145 billion (2009 estimate)
Annual Growth: 0.7% (2009 estimate)
Inflation: 8.8% (2009 estimate)
Major Industries: Mineral production, game and
cattle ranching, fishing, tourism.
- Mining is 2nd largest industry (20% of GNP): copper,
diamonds, uranium, zinc
Major trading partners: South Africa, UK, Spain,
Japan, China and USA.
Taxation of oil production:- 5% State Royalty /
35% corporation tax / no capital gains / when threshold reached APT
can apply range between 15 - 33%
Country Risk Profile: BBB (Source: The
Economist)
Existing presence: BHP, Anglo, Areva, DeBeers,
Rio Tinto
POLITICAL SITUATION
An ethnically diverse republic, which gained political independence from South Africa in 1990, Namibia operates as a stable democracy with a population of approximately 2.2 million. The government has pursued free-market principles designed to promote commercial development, has good relations with its neighbours, and has actively encouraged international foreign investment.
INVESTMENT CLIMATE
The 1990 Namibian Foreign Investment act provides for freedom from nationalisation, freedom to remit capital and profits, currency convertibility and a process for settling disputes equitably. Namibia's 2008 GDP was estimated at US$7.78 billion and its gross domestic real growth rate was 3.9%. Namibia has a country risk profile of BBB, putting it on a par with Brazil and South Africa.
OIL AND GAS EXPLORATION
Overview:
The Namibian offshore basins are located in the south-eastern part of the south Atlantic margin (on the West Africa side) and extend from land out to the 3000 metre isobaths. These basins are directly related to the rifting of the African and the South American plates during the Lower Cretaceous period. Evolution of the South Atlantic started in the Jurassic era with a rift system that evolved into the passive margin basins of the present day.
Chariot's offshore blocks are located along the coast of Namibia and are bordered by the paleodepositional systems of the Kunene River to the north and the Orange River to the south.
Exploration in Namibian Margin to date:
Sporadic exploration activity in the Southern African Atlantic margin led to the discovery of the giant Kudu gas field (in Namibian waters), now under development, and the Ibhubesi oil and gas fields (in South African waters). There has only been one phase of exploration, in the early 90’s, which was targeted at the primary Namibian margin and culminated in the drilling of 8 exploration wells, all located in the shallow waters on the shelf and slope portions of the basin due to technical and commercial limits that existed at that time. Our newly acquired seismic data combines evidence of large structural features with direct hydrocarbon indications which provide strong support for the move into the deeper water sections of these basins. These were areas that were technically out of reach to the early explorers in Namibia.
Other Operators:
Frontier for discovery
The Namibian oil and gas sedimentary basins are relatively under-explored frontier basins for hydrocarbon accumulations. To date, there has been a total of 15 wells drilled offshore Namibia, of these, seven were classified as exploratory while seven were development or appraisal wells in the Kudu field.
There has been increasing interest in Namibia as a prospective region for oil and gas exploration over the past few years driven by enhanced global deep water offshore experience and expertise, improved gas prices and demand for gas off-takes, and there is new geological evidence which suggests that Namibia may have oil resources as well as gas. The offshore Namibian basins can also be considered strategically important, being located in close proximity to South Africa's energy market.
Recent Developments:
Exploration offshore Namibia is also being undertaken by other operators - most significantly the drilling of the Kunene well in block 1711, (located to the north of our block 1811A) which was concluded in August 2008. This was a noteworthy step forward in the exploration of this region, marking the first exploratory well drilled offshore Namibia in over a decade and representing only the third well ever drilled in these waters to depths greater than 500m. The Namibian government reported that geological analysis of the drilling results indicated oil and gas potential in Block 1711, with a potential gas resource for the area of up to 14 tcf as well as good prospects for the region as a whole. Please click here for link to announcement from the MME on this. Further exploration will continue in this licence area.
The Kudu field, the only proven hydrocarbon system offshore Namibia to date, has estimated gas reserves of 3 trillion cubic feet (with potential to be 9 tcf subject to further exploration and analysis) and is located in the southern portion of offshore Namibia, south of Chariot's blocks 2714 A & B. With power shortages facing the southern African region, the Namibian government has committed to the development of this field.
Recent reports have stated that first gas production is expected from Kudu in 2013. This gas will be used both in Namibia, helping to meet the country's growing energy demand and exported to South Africa. An investment of ZAR2.5bn to build a pipeline in the Western Cape to distribute this gas has been announced and completion is expected by 2014.
Sources:
http://www.fco.gov.uk/en/about-the-fco/country-profiles
https://www.cia.gov/library/publications/the-world-factbook/geos/wa.html
Business Report
The Namibian
Informante
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+0.09p (0.07%)
14:40 29/07/2010
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