Chevron expands Namibia offshore exploration with completion of PEL 82 farm-in agreement

Chevron Namibia Exploration II Limited, a subsidiary of Chevron Corporation, has officially completed its farm-in agreement with Custos Energy (Pty) Ltd. for Petroleum Exploration License 82 (PEL 82). This strategic move strengthens Chevron’s foothold in Namibia’s offshore oil and gas sector, signalling a growing interest in the country’s untapped energy potential. Under the terms of the agreement, Chevron acquires an 80% participating interest and operatorship of PEL 82, while Custos Energy and the National Petroleum Corporation of Namibia (NAMCOR) each retain a 10% stake.

This transaction represents a significant milestone for Namibia’s energy landscape, aligning with Chevron’s broader global exploration strategy focused on expanding its offshore portfolio in geologically promising regions. As major international energy companies turn their attention to Namibia’s offshore basins, the PEL 82 deal underscores the country’s emerging role as a key player in the global oil and gas industry.

Chevron’s Strategic Expansion in Namibia’s Offshore Oil Sector

PEL 82 covers blocks 2112B and 2212A, located in the Walvis Basin off the coast of Namibia. The Walvis Basin is considered one of the most prospective offshore regions in the country, attracting interest from global energy giants due to its favourable geological conditions and untapped hydrocarbon potential. Approximately 70% of PEL 82’s total area is already covered by extensive seismic data, including over 3,500 km of 2D and 9,500 km² of 3D seismic surveys. This comprehensive data set provides a robust foundation for Chevron’s exploration activities, offering valuable insights into the basin’s subsurface structures.

Previous drilling campaigns within PEL 82, such as the Murombe-1 and Wingat-1 wells, have provided critical geological information, helping to de-risk future exploration efforts. While these earlier wells did not result in commercial discoveries, they contributed significantly to the understanding of the basin’s complex geological framework, paving the way for more targeted drilling programs under Chevron’s operatorship.

Building on Existing Offshore Assets: Chevron’s Presence in the Orange Basin

Chevron’s acquisition of an interest in PEL 82 complements its existing operations in Namibia, particularly in the Orange Basin, where it holds a stake in Petroleum Exploration License 90 (PEL 90). In January, Chevron, in collaboration with its joint venture partners Trago Energy (Pty) Ltd.—a subsidiary of Custos Energy—and NAMCOR, completed its first deepwater offshore well in PEL 90. Although the well did not yield a commercially viable discovery, it provided valuable geological data that will inform future exploration strategies in the region.

The Orange Basin has recently gained significant attention following a series of major oil discoveries by other operators, positioning Namibia as a potential new frontier in offshore oil exploration. Chevron’s continued investment in both the Orange and Walvis Basins reflects the company’s confidence in Namibia’s offshore potential and its commitment to long-term exploration and development in the region.

Expert Insights: The Strategic Importance of PEL 82 for Chevron and Namibia

Knowledge Katti, Chairman and Chief Executive Officer of Custos Energy, highlighted the strategic significance of the PEL 82 farm-in agreement, describing it as a testament to the quality and potential of Namibia’s offshore resources. “The completion of Chevron’s entry into PEL 82 is another indicator of the opportunities within our offshore portfolio,” Katti remarked. “We are excited to expand our partnership with Chevron, positioning ourselves to unlock the potential of another emerging basin in Namibia.”

Industry analysts view Chevron’s farm-in as a calculated move to diversify its exploration portfolio amid a global shift towards securing new energy resources. By expanding its presence in Namibia, Chevron not only strengthens its exploration acreage but also positions itself to capitalise on potential discoveries in a region that has quickly become a hotspot for offshore oil exploration.

Furthermore, the partnership with Custos Energy and NAMCOR underscores the importance of collaboration between international oil companies and local stakeholders. This collaborative approach not only facilitates knowledge transfer and capacity building but also ensures that the benefits of resource development are shared with the Namibian people.

The Broader Impact on Namibia’s Energy Landscape

Custos Energy, a Namibian independent oil and gas exploration company, has been instrumental in attracting international investment to the country’s offshore sector. Founded over a decade ago by Knowledge Katti, the company is committed to fostering sustainable growth within Namibia’s energy industry. Through partnerships with global energy leaders like Chevron and initiatives led by the Knowledge Foundation, Custos aims to support community development, particularly focusing on youth empowerment and local economic opportunities.

The completion of the PEL 82 farm-in deal is more than just a corporate transaction; it represents a step forward for Namibia’s aspirations to become a significant player in the global energy market. As exploration activities ramp up, Namibia is poised to benefit from increased foreign investment, job creation, and the development of critical infrastructure to support the burgeoning oil and gas industry.

Chevron’s continued exploration efforts, combined with the expertise and local knowledge of partners like Custos Energy and NAMCOR, could potentially unlock vast hydrocarbon resources, transforming Namibia’s economy and securing its position on the global energy map.