TotalEnergies and Petrobras purchase land north of Namibia's massive Mopane discovery

Both TotalEnergies, the French oil giant, and Petrobras, the Brazilian firm acquired a 42.5% share in an offshore exploration license. The firms are looking to "develop" oil in one of last frontiers in exploration.

Total has expanded its holdings in South Africa, where the company hopes to become the first oil producer by the end decade.

Petrobras has also made a significant step in its plan to make Africa its primary exploratory region outside Brazil.

Oil companies looking to replenish their reserves are flocking to Namibia. The country has no hydrocarbons production but a series of high-profile discoveries have shown that it could be a top-15 oil producer in the next decade.

Partners for more than a decade

Total, the company that will run PEL104, has already developed Venus, a development of 150,000 barrels per day to the south. It also holds a 40% stake in Galp’s massive?Mopane oil discovery. This is estimated to contain more than 10 billion gallons of oil.

Petrobras and TotalEnergies have been partners in Brazil's oil industry for over a decade. They acquired the licenses from Maravilla Oil and Gas and Eight Offshore Investments Holdings for an amount that was not disclosed.

Total's President of Exploration and Production, Nicolas Terraz said, "We are delighted to expand our portfolio, and to continue exploring Namibia's prolific resources, to unlock additional value for the country and its stakeholders."

All Eyes on Namibia

Petrobras, Exxon, and Shell were among the dozen companies that bid for a stake in Mopane. Total won it in December.

Petrobras' head of exploration, Sylvia Anjos said, "We are closely studying the West African coastline and the opportunities in Africa." She added that the African coast is geologically similar with Brazil.

Petrobras acquired stakes in offshore fields off South Africa and Sao Tome and Principe during the last two years. It hoped to profit from its geological knowledge, which led Shell to write-down its Namibian assets and Total to flag higher development costs.

TotalEnergies has received between 25 and 40 percent of its oil from Africa in the last two decades. Namibia represents a chance to replenish their reserves, while projects in Mozambique, Uganda, and other African countries face financial and security challenges.

Maravilla's stake will be withdrawn from the deal, but Eight will retain 5%, and Namibian state-backed Namcor 10%.

(source: Reuters)