In a significant deal, Reconnaissance Energy Africa (ReconAfrica) has sold a 20% working interest in Petroleum Exploration License 73 onshore Namibia to Oslo-listed oil and gas company BW Energy. The African Energy Chamber (AEC) (www.EnergyChamber.org) – as the voice of the African energy sector – supports this new joint venture structure which is expected to speed up exploration activities in Namibia and provide working capital, with a total potential consideration of $141 million.
ReconAfrica is currently leading the exploration efforts in the onshore Kavango Basin, where it recently started drilling the Naingopo-1 well targeting the Damara Fold Belt and has plans to conduct a multi-well exploration program and acquire a 3D seismic program in the Kavango Rift Basin. The company has gathered extensive data and insights on the petroleum system in the Kavango Basin to minimize exploration risks and identify future drilling targets. With this transaction, BW Energy will participate in two Damara Fold Belt exploration wells and the 3D seismic program, with the option to take part in two Rift Basin exploration wells over a two-year period. ReconAfrica will retain a 70% working interest in the license, offering significant potential upside if a discovery is made.
This agreement leverages BW Energy’s expertise in oil and gas monetization in both emerging and mature markets. The company is already active in Namibia with an operated stake in the 1.3-trillion-cubic-feet Kudu gas field in the Orange Basin and the associated Kudu gas-to-power project, which is currently in the FEED stage and aims for FID in 2025. The project is expected to revolutionize Namibia’s energy sector by providing 800 MW of gas-fired power for domestic and regional use. BW Energy also operates the Dussafu Marine license offshore Gabon, which includes the Hibiscus and Ruche Field Development set to reach 40,000 barrels per day upon completion of all wells.
The AEC applauds BW Energy for expanding its presence in exploration hotspots like Namibia and showing confidence in Africa’s upstream industry. This deal, which includes a $16 million equity investment in ReconAfrica and an additional $45 million in carry payments based on FID, is set to accelerate onshore exploration activities and demonstrates the growing global interest in Namibia’s oil and gas potential. With BW Energy scheduled to begin drilling at the Kudu gas project in early 2025 and recent discoveries by Shell, TotalEnergies, and Galp in the offshore Orange Basin, Namibia is poised to attract more investment from global explorers.
“ReconAfrica and BW Energy are collaborating to unlock Africa’s untapped onshore resources, combining financial resources and technical expertise to drive impactful exploration programs. The Chamber supports this strategic partnership, which strengthens Namibia’s attractiveness as an investment destination and represents a significant advancement for the African upstream industry,” says NJ Ayuk, Executive Chairman of the AEC.
Distributed by APO Group on behalf of African Energy Chamber.