Rikus Grobler | Oct 18, 2017 | 0
Fossil fuel prospectors place bet on local oil find
Eco Atlantic Oil CEO, Gil Holzman is optimistic about the prospects for oil exploration and production in Namibia.
Speaking to Oil Review Africa this week Holzman said Eco Atlantic Namibian prospects are focused more on oil rather than gas.
Eco Atlantic holds a 32.5 % stake in license PEL0037 as operator, located offshore Walvis Bay in the so-called Walvis Basin. Tullow Oil has farmed out 30 % of its 65% operating interest in the the license to India’s Oil and Natural Gas Corporation Limited (ONGC).
“With 2tcf of gas, it’s more of a burden without proper infrastructure [and] its too small for LNG,” Holzman said, intstead, Eco Atlantic has been making investments, particularly in seismic data, while prices have been low during the downturn, as well as partners, such as AziNam helping to fund seismic activity. He said it has been a good time to invest, while the oil and service prices have remained low.
License PEL0037 is located immediately north of the Cooper license (PEL 0030) in which Eco holds a 32.5% interest and is operator, Azinam holds 32.5%, Tullow Oil holds 25% and NAMCOR owns 10%. In addition, Tullow has an option to increase its interest on the Cooper license to 40% upon a drilling decision.
“This is a new era for oil exploration in Namibia,Holzman said, adding that it is a sign of confidence in the country’s prospects that large companies such as ONGC and Tullow are investing. With Tullow on a March 2018 deadline to drill its first well, Holzman expects increased activity for the Namibian hydrocarbons sector over the next 12 months, including farm-ins, farm-outs and M&A activity.
Eco Atlantic’s interests across four offshore petroleum licenses total approximately 25,000 sq km with more than 2.3bn barrels of prospective resources in the Walvis and Lüderitz basins.These four licenses, Cooper, Guy, Sharon and Tamar, are being developed with partners, including Tullow Oil, AziNam and Namibian national oil and gas regulator NAMCOR.
Now the oil price is stabilised at around US$50, now the industry is better suited to go into the second exploration cycle of Namibia,” Holzman told Oil Review Africa.”With offshore gas in Namibia, it is possible to break even at around US$30-US$35 oil. The royalties [to the Namibian government] are 5 %, the fiscal terms are really favourable.”
Praising the Namibian government for creating a fiscal and regulatory environment that makes it an easy country in which to do business. “The Namibian government understands that it’s a competitive market and they must compete with other governments – the minister and the head of NAMCO understand this perfectly,” Holzman said.
“They really are a partner to the industry, the give extensions if they are required and they share a lot of information,” he added.