Minister of Mines and Energy, Tom Alweendo has said that the recent discovery of oil in itself will not necessarily lead to cheaper local fuel price.
Not long ago a joint venture consisting of Shell, Qatar Energy and Namcor announced that they have discovered oil offshore. Soon after that, another joint venture consisting of Total Energies, Qatar Energy and Namcor made a similar announcement that they have discovered oil.
“This will depend on a number of factors, such as the costs to extract the crude and the cost to refine it. In our case, given the fact that this will be deep water extraction, the extraction cost is likely to be much higher than in some other jurisdictions. Oil extraction cost is lowest in the Middle East. This is, however, not a sufficient reason not to invest in a local refinery. It will all depend on the economics of such an investment and an assessment of that will be made at an appropriate time.
“I would like to commend Shell, Total Energies and Qatar Energy for their commitment to invest in our country. They started with their drilling campaigns at a time when, due to the Covid-19 pandemic, logistical arrangements were rather challenging. However, they persevered and completed the drilling campaigns as per schedule. It is even more commendable that they decided to invest at a time when the global energy transition discussion has reached a crescendo, making investing in hydrocarbon riskier than it was before,” Alweendo said in Parliament last week.
The minister went on toassure the investors that they have not made a mistake to invest with Namibia and that Namibia will continue to be a great investment destination.
“We look forward to work with them to expedite the process of bringing the discoveries to production. Going forward, we need to form a strategic partnership rooted in a collaborative leadership to ensure a mutually beneficial relationship.
“I call on all Namibians to be ambassadors for encouraging more investment, both local and foreign, in our economy. While doing so, let us also know that we will do better as an economy and as a country when we agree to conduct ourselves in a manner where the glass is half full rather than it being half empty,” he said.