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Namibia is optimistic about the future economic prospects following the discovery of oil by Qatar Energy, Shell, and Total Energies in the Orange Basin, offshore Namibia near Lüderitz. The country could register a gross domestic product (GDP) of U$37 billion at peak production level from the newly discovered oil reserves. At the peak of production level, the country will also benefit from direct jobs and local businesses will get a boost through procurement.
Namibia is optimistic about the future economic prospects following the discovery of oil by Qatar Energy, Shell, and Total Energies in the Orange Basin, offshore Namibia near Lüderitz. The country could register a gross domestic product (GDP) of U$37 billion at peak production level from the newly discovered oil reserves. At the peak of production level, the country will also benefit from direct jobs and local businesses will get a boost through procurement.
The joint-venture group comprises Shell Namibia B.V (45%), QatarEnergy (45%) and NAMCOR (10%). NAMCOR’s 10% free-carry stake in the joint-venture oil exploration and appraisal with Qatar Energy and Shell, which has discovered four wells about 270km offshore Namibia’s coast.
The nation has been concerned with the 10% shareholding, arguing that it does not really represent the populace’s interest and benefits from its natural resources. But in essence, the state tends to benefit about 54% when production begins, as the state will be able to generate revenue through employment, royalties, taxes, petroleum income tax, profit tax, and annual licence fees. NAMCOR carries interest on behalf of the State even though it does not make any monetary contribution, but rather participates in technical aspects.
Read Also:
https://trendsnafrica.com/shell-makes-another-offshore-discovery-in-namibia/
https://trendsnafrica.com/namibias-offshore-oil-exploration-a-record-high/
The government should not be over-reliant on oil making it the anchor of the economy because there might be dire consequences when the sector collapses. Learn what happened to Angola where 50% of its budget was heavily reliant on the oil sector, so when the economy melted, it experienced a deficit. Namibia should learn and avoid such a scenario, rather remain diverse by continuing to develop the agricultural sector, mining, and tourism.
