Despite Shell’s recent decision to write off its US$400 million exploration campaign in Namibia’s Orange Basin, global energy consultancy Wood Mackenzie remains optimistic about the region’s deepwater potential.
In a recent analysis using its Lens Subsurface platform, Wood Mackenzie assessed Shell’s drilling efforts and concluded that the setback does not spell the end of exploration in the Orange Basin for Shell or Namibia. The firm believes that Namibia will still emerge as a deepwater oil producer in the coming years, albeit not from Shell’s license area.
Shell’s exploration campaign, which targeted multiple plays across its PEL39 license area, faced significant challenges due to complex subsurface conditions. The company drilled nine wells—six exploration and three appraisal wells—across three distinct plays: the Upper Cretaceous deepwater turbidite clastic play in the Graff complex, the Lower Cretaceous deepwater turbidite clastic play in Jonker and Enigma, and the Lower Cretaceous carbonate play in Cullinan-1X. While Shell encountered hydrocarbons in some wells, such as Graff-1X, La Rona, and Jonker-1X, the Cullinan-1X well proved to be a dry hole, highlighting the inherent risks of deepwater exploration.
Wood Mackenzie’s analysis suggests that Shell is likely to retain its Orange Basin acreage in South Africa while potentially letting its Namibian blocks lapse. The firm notes that different parts of the basin have varying geological characteristics, and Shell’s setbacks do not diminish the prospectivity of other Orange Basin blocks. TotalEnergies and Galp, for instance, have reported more promising results, with larger volumes and better-performing wells, making commercial production in the region increasingly likely.
Wood Mackenzie is a leading global energy, chemicals, renewables, metals, and mining research and consultancy firm. Founded in 1923, the company provides data, analytics, and insights to help clients make informed decisions in the energy and natural resources sectors. Its Lens Subsurface platform is a powerful tool for analyzing subsurface data, enabling companies to evaluate exploration prospects and assess risks in frontier and mature basins alike.
Namibia’s Orange Basin has emerged as a hotspot for deepwater oil exploration in recent years, attracting major international oil companies. The basin, which spans the maritime border between Namibia and South Africa, is characterized by its Cretaceous deepwater turbidite clastic plays, which have shown significant hydrocarbon potential. However, exploration in frontier basins like the Orange Basin is inherently risky, with technical success rates averaging below 40% globally. Namibia has stood out with a relatively high technical success rate, but commercial viability remains a challenge due to factors such as reservoir complexity and distribution.
Shell’s PEL39 license in Namibia’s Orange Basin is operated in partnership with QatarEnergy (45%) and Namibia’s national oil company, Namcor (10%). Despite Shell’s mixed results, the broader Orange Basin continues to attract interest, with TotalEnergies and Galp making notable discoveries. These successes underscore the basin’s potential, even as companies navigate the technical and commercial hurdles of deepwater exploration.
While Shell’s recent setbacks have tempered expectations, Wood Mackenzie’s analysis suggests that Namibia’s Orange Basin remains a promising frontier for deepwater oil exploration. With continued investment and technological advancements, the region could soon join the ranks of Africa’s major oil producers.