Dawn breaks in Namibia while Europe heads for bunkers
With the price of gold, natural gas and oil through the roof, and a looming energy crisis on the horizon, several projects in Namibia are well positioned as Europe heads for the bunkers.
By Leon Louw, owner and editor of WhyAfrica
As Russian troops continue their march towards Kiev, the world’s investors have once again found solace in gold. At the same time the security crisis in Europe has sent oil and gas prices soaring. In the same week that missiles started raining down on the Ukraine, news about gold and energy projects in Namibia had to take a back seat to President Putin’s dangerous geopolitical dance with Europe.
Nevertheless, Putin’s moves have unintended consequences around the world, and in some cases, it is not always bad news. Gold and energy developers in Namibia, buoyed by recent discoveries, are watching the market indicators with interest as Putin drags the West further into a sticky quagmire.
If you have some of your eggs in the gold, oil, and gas basket right now, you could be generously rewarded, unless the basket is in Russia or the Ukraine, of course. If the basket is in Namibia on the other hand, your risks are low. As foreign oil, gas and mining companies scamper to get rid of their Russian assets, three new developments in Namibia caught my eye last week, while trying to figure out what the repercussions of sanctions on Russia will mean for Africa.
Another oil and gas discovery
The biggest announcement came from TotalEnergies who released a statement about a significant discovery of light oil and associated gas off the coast of Namibia. Total’s large discovery in the Venus-X1 well follows hot on the heels of the National Petroleum Corporation of Namibia (Namcor) announcement that it and its partners – Shell Namibia Upstream BV and QatarEnergy – have discovered light oil at the Graff-1 deep-water exploration well located in the Orange Basin about 270km away from the diamond mining town of Oranjemund in the south of the country. As a matter of interest, Shell joined oil giants BP and Equinor this week in abandoning its Russian investments in protest against President Putin’s attacks on the Ukraine.
According to Total’s statement its Venus prospect, located in block 2913B in the Orange Basin, had found a good quality reservoir. According to news agency Reuters the discovery was more than one billion barrels of oil equivalent.
“This discovery offshore Namibia and the very promising initial results prove the potential of this play in the Orange Basin, on which TotalEnergies owns an important position both in Namibia and South Africa,” Kevin McLachlan, TotalEnergies’ senior vice president for exploration, said in the statement.
McLachlan said that a comprehensive coring and logging programme has been completed to help with preparations for appraisal operations to assess the commercial merits of the discovery.
TotalEnergies is the operator with a 40% working interest, alongside QatarEnergy (30%), Impact Oil and Gas (20%) and state-owned NAMCOR (10%).
Osino Resources on a roll
The second significant statement was by gold exploration company Osino Resources. The TSX listed company doing exploration work at its Twin Hills gold project, close to Karibib in the centre of Namibia. Although the project is still in its early stages, the results have been encouraging. Last week, the company announced the discovery of the highest-grade shoot yet intersected at Twin Hills.
According to Dave Underwood, Osino’s VP Exploration, the latest step-out drillholes also intersected previously unknown shallow mineralisation on the northern edge of the Twin Hills Central (THC) PEA pit, offering the potential for additional mineralisation and reduced waste stripping in that area.
We received a really nice surprise with the latest set of infill and step-out assays with one of our best ever intercepts of 69m at 2.06 grams per tonne (g/t) including 34m at 3.65g/t.
“This hole was drilled on the far northern side of THC and appears to have hit a high strain zone in a silicified fold nose, containing the familiar mineralised sulphide veinlets but in this zone overprinted by extensional quartz veins. This is not something we have seen at Twin Hills before, and it demonstrates that Twin Hills can continue to surprise on the upside. This mineralisation is currently below the PEA pit envelope and thus has the potential to increase the size of the future pit shell. It is also the first real indication of future underground potential at Twin Hills. It appears that our drilling to the north-east may have passed over the top of the high-grade shoot and the next round of drilling will be focused on chasing it down plunge to the north-east,” says Underwood.
Hydrogen in the mix
In the same week Namibian company Ohlthaver & List (O&L) Group and CMB.Tech agreed to begin construction of a hydrogen plant, aiming for first production by the end of 2023.
The two companies announced that they would build Namibia’s first green hydrogen facility, via the Cleanergy Namibia joint venture. The demonstration plant will be in the Erongo region, around Swakopmund on the coast.
According to O&L chairman Sven Thieme, the companies could commit to a larger production plant depending on how the execution of the plan progresses. Thieme adds that this may involve the use of ammonia as a transportation fuel.
“Green hydrogen has tremendous potential in helping the move beyond fossil fuels. Namibia is a growing hub when it comes to the generation of renewable energy, whether that be through solar, wind or hydroelectric power, and this is what makes our country optimally positioned to explore the generation of green hydrogen, or hydrogen that is generated using renewable electricity. The production of green hydrogen will help Namibia move towards energy independence,” says Thieme. The first demonstration plant involves an investment of about USD18-million.
Leon Louw is the founder and editor of WhyAfrica. He specialises in natural resources and African affairs.
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