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Southern Africa

Shell Reaffirms Long-Term Commitment to Namibia’s Energy Sector with Over N$1 bn Investment Despite Setbacks

July 17, 2025

(3 Minutes Read)

Global energy powerhouse Shell has reiterated its long-term commitment to Namibia’s oil and gas sector, announcing that it has already invested more than N$1 billion in exploration activities within the country. This announcement comes despite recent operational setbacks and underlines Shell’s strategic view of Namibia as a key frontier in offshore energy exploration.

The pledge was made during a high-level courtesy visit to President Netumbo Nandi-Ndaitwah by Eugene Okpere, Shell’s Executive Vice President for Exploration, Strategy and Portfolio, Integrated Gas and Upstream. President Nandi-Ndaitwah welcomed Shell’s continued interest, describing the partnership as essential to Namibia’s national development agenda.“Your sustained presence helps advance our vision of making Namibia a regional energy hub,” she said. “We value investments that deliver not only revenue but also jobs, infrastructure, and skills development for our people.”

During the meeting, Okpere emphasized that Namibia remains a vital component of Shell’s upstream strategy, noting that the company continues to explore new investment opportunities, even in the face of geological and commercial challenges.“Namibia holds promising potential,” said Okpere. “Shell is committed to being a long-term partner in the country’s offshore development, and we are actively assessing avenues for continued growth and collaboration.”

Shell’s reaffirmation comes shortly after a major financial hit in January 2025, when the company wrote down approximately USD 400 million related to its oil discovery in Block PEL39. The discovery, made in partnership with QatarEnergy and Namcor, was ultimately deemed commercially non-viable due to complex geological factors including high gas content and poor rock permeability.

Shell CEO Wael Sawan acknowledged the challenges during a corporate update, stating that the block presented “very challenging” conditions that complicated any potential commercial development.

Despite these hurdles, Shell has drilled nine wells in Namibia since 2022 and maintains its exploration efforts, signaling that the company still sees significant upside potential in the region’s untapped offshore resources.

While Shell grapples with the technical difficulties of some of its blocks, Namibia’s energy sector is experiencing a broader resurgence. Successful discoveries by Galp Energia and TotalEnergies have helped maintain strong global interest in the country’s offshore basins, reinforcing Namibia’s status as a rising star in African energy exploration.

Energy analysts interpret Shell’s sustained investment as a strategic move aimed at long-term gains, rather than short-term profit. This aligns well with the Namibian government’s push to enhance investor confidence through regulatory reforms, infrastructure development, and policies that prioritize local value creation.

For Namibia, Shell’s involvement remains integral to its energy transformation strategy. Government leaders have consistently emphasized the importance of ensuring that international investments translate into real socio-economic benefits—including job creation, skills transfer, and national energy security.

Shell’s posture—a mix of strategic caution and forward-looking optimism—reflects the complex but high-potential nature of offshore energy development. While losses like the PEL39 write-down serve as reminders of the risks involved, the company’s continued presence reinforces the view that Namibia remains a high-stakes, high-reward frontier for global energy giants. In summary, Shell’s recommitment is more than a corporate gesture—it is a vote of confidence in Namibia’s future as a key player in the global energy landscape.