COLUMN | Namcor’s woes as chair arrested for drugs and managing director suspended over Angolan deal: will Namibia emulate Nigeria or Norway? [Offshore Accounts]

This Easter, after looking at three companies that experienced miracles last week, we move to an entire country that stands on the cusp of a miraculous transformation: Namibia.

Namibia is a large country in south-west Africa, with a small population of less than three million people. Namibia is one of the few countries in the world where the protection of the environment is written in its national constitution (under Article 95), and it is famous as a tourist destination for its wild Skeleton Coast and flourishing wildlife parks, such as Etosha.

Diamonds are Windhoek’s best friend

Benguela Gem (Photo: Damen)

The country is already a major diamond miner, and De Beers, through its Debmarine joint venture with the government, put a new US$420 million coastal diamond recovery vessel, Benguela Gem, into service a year ago. Namibia produced around two million carats of rough diamonds in 2022, most of these being recovered offshore by Debmarine and its fleet of six diamond recovery vessels.

For decades, Namibia had been trying to develop the offshore Kudu gas field, now operated by BW Energy, but still not in production. Exploration attempts by Repsol and its partners in 2014 ended in failure when the US$100 million Welwitschia well came up dry after expensive problems with the blowout preventer on the drillship Rowan Renaissance. In 2018, Chariot Oil and Gas also reported a disappointing result from the Prospect S deepwater exploration well drilled by the drillship Ocean Rig Poseidon.

But all that changed last year. Both Shell and TotalEnergies made large deepwater oil discoveries in Namibia in 2022, and both companies are currently drilling appraisal wells there as well as conducting additional exploration.

Now, Namibia sits in the spotlight as a potential offshore jewel, one of the most exciting and prospective oil and gas frontiers in the world.

Shell goes Jonkers

Last month, Shell announced a third successful well, Jonker-1x, another light oil discovery in Block 2913A, on top of the Graff-1x and La Rona-1x discoveries made in the same block last year. The well was drilled by Odfjell’s semi-sub Deepsea Bollsta in 2,210 metres of water, and the rig has now moved to test the Graff-1x discovery.

The National Petroleum Corporation of Namibia (Namcor) is a 10 per cent partner with operator Shell and QatarEnergy in the block.

“This discovery has proven the exciting and world-class potential of the deep-water Orange Basin,” commented Immanuel Mulunga, Managing Director of Namcor in the company’s press release.

The summit of beauty and love – and Venus was her name

“Yeah, baby, she’s got it,” sang British girl band Bananarama in their 1980s pop track Venus, probably not thinking of 84 metres of net oil pay in a good quality Lower Cretaceous reservoir.

Venus was the groundbreaking discovery announced by TotalEnergies a year ago in Namibia’s Block 2913B in about 3,000 metres of water. It sparked speculation that the Orange Basin could hold 12 billion barrels of oil and many trillions of cubic feet of gas.

Photo: TotalEnergies

TotalEnergies’ optimism is confirmed by the fact that the French supermajor plans to spend US$300 million, half of its entire 2023 exploration budget, on a four well deepwater Namibian exploration and appraisal campaign. Already the Vantage-owned drillship Tungsten Explorer has spudded an appraisal well 13 kilometres away from the initial Venus discovery well. In parallel, the Odfjell-managed, Northern Ocean-owned, 2019-built semi-sub Deepsea Mira is sailing from Norway to arrive in Namibia in May to test the Venus 1A well. Total is also partnering with QatarEnergies in the block, and Namcor has a 10 per cent stake.

TotalEnergies will also spud the Nara-1 exploration well in neighbouring Block 2912 using Tungsten Explorer later this year.

Gold rush begins

The successful discoveries by TotalEnergies and Shell spurred Chevron to farm in and acquire the operatorship of block 2813B with an 80 per cent interest last October. This block is located immediately north of Venus.

Then on March 1, Australian giant Woodside announced that it had entered into an agreement for an option to acquire a 56 per cent interest in Petroleum Exploration License 87 (“PEL 87”) offshore Namibia by paying the full cost for a 3D seismic survey covering an area of at least 5,000 square kilometres at an estimated cost of US$35 million.

Namibia is starting to look like Guyana, the other prolific new oil producer on the other side of the Atlantic.

Sovereign wealth fund set up

Shortly after the two discoveries last year, the Namibian government created a sovereign wealth fund similar to the Norwegian model. President Hage Geingob said the Welwitschia Fund would get an initial injection of NA$262 million (US$16.3 million) and would invest 2.5 per cent of its portfolio locally to bridge the country’s infrastructure financing gap. It is a state-owned investment fund financed by surplus mineral revenues as reserves to promote economic development and savings for the country’s citizens, for both present and future generations.


So, everything looks great on paper and Namibia’s experience managing its diamond resources has been relatively successful. However, since its independence from South Africa in 1990, Namibia has been ruled by one political party, Swapo, which has routinely won both parliamentary and presidential elections. In December 2014, Hage Geingob took 87 per cent of the vote at the presidential election, but in 2019, he was re-elected with only 56 per cent of the vote.

A one-party government and large oil revenues has been a recipe for disaster in other major oil and gas producers. And we don’t just mean in Scotland, where the Scottish National Party’s former chief executive was questioned by police for eleven hours last week regarding missing party funds, but seemingly not about the Ferry Fiasco.

Applying good governance and ethical management of the resources for the benefit of the country and its citizens as a whole is of utmost importance, something which every oil producer earnestly promises to do, but few, apart from Norway, manage successfully over the longer term.

Guyana’s precedents are not good

Liza Destiny (Photo: SBM Offshore)

We covered the political stalemate that paralysed Guyana for five months in 2020, just as its first deepwater oil was coming into production from the SBM Offshore floating production storage and offloading vessel (FPSO) Liza Destiny, and first oil revenues were flowing into the treasury in Jamestown from ExxonMobil. The country was in turmoil when outgoing president David Granger refused to concede defeat in parliamentary elections and tried to rig the vote count in one key constituency (In Guyana, it is the national parliament elects the president.).

Guyana did eventually resolve the crisis, and Mr Granger did step aside in August 2020. Now the country’s third FPSO, Prosperity, will arrive from Singapore just as this article goes to press, for deployment on ExxonMobil’s Payara project. Then, in 2024, ExxonMobil’s fourth FPSO, One Guyana, will come online and is scheduled to begin production in late 2025, according to The Guyana Chronicle. ExxonMobil has indicated that there could be as many as ten FPSOs operating offshore Guyana eventually.

Guyana’s young democracy survived its first crisis in 2020, but the massive influx of oil revenues is likely to stress the country’s institutions and democratic structures, as it will in Namibia when first oil flows there five years from now, if all goes well.

African oil and gas is a trough for the corrupt

The governance of most African oil producers is terrible, as this list of 2021 oil production in Africa shows. That year’s largest producer, Nigeria, is a by-word for corruption and state plunder. The ongoing detention of the 26 innocent seafarers from the tanker Heroic Idun shows the complete dysfunction of the courts system and the incompetence of the military there, whilst our coverage of the massive bribes received by the country’s previous oil minister, Diezani Alison-Madueke, show that embezzlement is practiced with impunity at the highest levels of government.

Angola, which surpassed Nigeria as Africa’s largest oil producer in 2022, was plundered for decades by late president José Eduardo Dos Santos and his children – we have covered the lavish lifestyle of his daughter Isabel, now living in the Bulgari Resort and Residences in Dubai despite being on the Interpol Red List for money laundering. The Luanda Leaks showed how she amassed hundreds of millions of dollars in assets through state plunder, aided and abetted by complicit western institutions, such as accounting firm and tax consultancy PwC, and private banks in Portugal.

Algeria – where investigating corruption is considered high treason

Algeria, the third largest oil producer in Africa, is run by a cabal of military officers who routinely imprison and torture their enemies. In October last year, Mohamed Abderrahmane Semmar, editor of the news outlet Algérie Part, was sentenced to death for “high treason” for leaking information about corruption within Sonatrach, Algeria’s state oil company.

Libya is torn by civil war between a Turkish-backed government in Tripoli, recognised by the United Nations, known as the Government of National Accord, and the Egyptian-backed rebel general Khalifa al Haftar, who controls the Libyan National Army and the east of the country. The country has been riven by violence since the revolution of 2011, when long-time leader Colonel Muammar Gadhafi was overthrown and killed in a gutter and oil exports collapsed to zero amid heavy fighting the following year.

Equatorial Guinea – another yacht seized after torture victim wins

In Equatorial Guinea, President Teodoro Obiang was re-elected last year and is now in his forty-fourth year in power after he successfully led a coup against his own uncle in 1979. Mr Obiang’s son Teodorin (aka “Teddy”) had his yacht Blue Shadow arrested in Cape Town in February by a South African businessman, Daniel Janse van Rensburg, who claimed he had been tortured in Equatorial Guinea and was awarded damages in South Africa against the president’s son for imprisoning him in Malabo. Teddy Obiang had previously had millions of dollars of property in the United States and France and a fleet of luxury cars in Geneva seized by the authorities as the proceeds of corruption.

Already over 80 years old, Teddy’s father is Africa’s second-oldest president, behind only his authoritarian neighbour in Cameroon, President Paul Biya, who came to power in 1982, but who reached ninety years old in February. Both Equatorial Guinea and Cameroon were named as countries where Swiss trading house Glencore was paying bribes to state officials when the company was convicted of corruption in 2022.

Then there is the Republic of Congo, home to major new liquefied natural gas (LNG) developments by Italian state energy company Eni, and where the irrepressible Denis Sassou Nguesso has been president since 1997. Mr Sassou-Nguesso retook power after a civil war then, having also previously served in the top role from 1979 to 1992. Then, he signed a treaty of friendship with the Soviet Union, and now he signs agreements with Eni CEO Claudio Descalzi to maximise gas output.

If Namibia does become a major oil producer this decade, the omens from elsewhere in the continent are not great.

Namcor Shenanigans highlight dangers: oil, drugs, and rock and roll?

Immanuel Mulunga (Photo: Namcor)

Optimists will point to Botswana as a beacon of African good governance and democracy to highlight that even if Namibia monetises its oil discoveries, it doesn’t have to go down the disastrous road pursued by president Mugabe in Zimbabwe, or the hopelessly corrupt and incompetent ANC government in South Africa.

However, recent developments at Namcor suggest that good governance needs to be implemented now. Namcor suspended its managing director Immanuel Mulunga, whom we quoted in a press release above, on full pay, as of April 4, pending an investigation into unauthorised activities.

Last month, Mr Mulunga was summoned to the Anti-Corruption Commission to explain a payment he made for an investment by Namcor to buy a stake in an Angolan offshore oil block from Angola’s state oil company Sonangol. The Namibian Sun newspaper reported that, as the deadline loomed for the deposit to be paid to Sonangol, Mr Mulunga asked the Namcor finance department to make payment, even though the board had not approved it.

“Surprisingly, the board turned down his request for approval,” sources told the newspaper. “And because he was not the only one with access to the account of the joint venture, by the time he tried to reverse the payment, another partner had already made payment to Angola. That’s what landed him in trouble.”

Mr Mulunga’s suspension was based not on this investment, but over alleged leaks of confidential documents to the Namibian media over an affidavit he made in a lawsuit with the company’s former CFO whose contract had not been renewed, and over missing oil from a storage facility in Walvis Bay.

Jennifer Comalie (Photo: Namcor)

The suspension of Mr Mulunga is seen in Namibia as part of a power struggle between him and Namcor’s board chairperson, Jennifer Comalie. Mulunga’s suspension came just a week after Ms Comalie was arrested on drugs charges in Windhoek after police allegedly found nearly a kilo of hashish and some grams of cocaine and crack cocaine in her car just after she attended a Namcor board meeting. Ms Comalie was granted bail of NA$7,000 (US$385) by the Windhoek Justice of the Peace’s Court ahead of her future trial.

Comalie then said that she was in fear of her life after Mulunga was suspended, and that she needed a state security detail.

At this stage, it is not clear who is in the wrong and who is in the right at Namcor. But, just as when millions of dollars were allegedly found under the sofa of South African president Cyril Ramaphosa at his ranch, it is clear that Namibia’s institutions need strengthening and that criminal behaviour should be investigated. One party should never remain in power for too long, and state-owned companies should be accountable and transparent to the public. The chair of a state oil company should not remain in office if she is arrested for drug charges, and its managing director should not be making unauthorised payments for overseas investments without board approval.

If Namibia is to benefit from the oil discoveries Total and Shell have made, it will need to break with the behaviours that other African oil producers have adopted.

A large country with a small population should be able to implement strong institutions and good government. Unfortunately, the examples of Brunei, Gabon, and Equatorial Guinea suggest that resource-rich small countries are prone to state capture. Namibia’s people and government (and those in Guyana and Suriname) should consciously try to emulate Norway, not Azerbaijan or Angola.

Let’s hope they can.

Background Reading

For more information on the incredible marine diamond recovery technology used by De Beers off Namibia, see Baird Maritime‘s vessel review of Benguela Gem.

The Nara-1 exploration wells is named after one of Namibia’s oldest plants, Acanthosicyos horridus, not the Japanese temple city of the same name.

Read our summary of the progress in Surinam and Guyana’s exploration efforts.

Our obituary to President Dos Santos of Angola, who died in July 2022, is here.

The Financial Times had an excellent interview last month with Farhat Bengdara, chair of the Libyan National Oil Corporation.

You can read the award in the Janse van Rensburg vs Obiang court filing in South Africa online. It makes grim reading regarding conditions in Equatorial Guinea’s detention facilities:

“The plaintiff testified that he was tightly handcuffed so much so that his wrists were cut. His hands were handcuffed to a rail in one of the rooms in a dungeon. He witnessed inmates being tortured in his presence in prison. He was later thrown in a small, crammed cell with about thirty inmates. The plaintiff was further tortured by other inmates in the cell. His arms ached from being handcuffed. He found it difficult to breathe in the room as it was hot and humid. He could not even swat a cloud of mosquitoes away, as his hands were cuffed behind his back. The floor of the cell was slippery and covered with human blood and vomit.”

Hieronymus Bosch

This anonymous commentator is our insider in the world of offshore oil and gas operations. With decades in the business and a raft of contacts, this is the go-to column for the behind-the-scenes wheelings and dealings of the volatile offshore market.