Reconnaissance Energy Africa (Recon Africa), along with its joint venture partner, the National Petroleum Corporation of Namibia (Namcor), last week confirmed the target depth was reached at its third stratigraphic test well in the Kavango basin.
According to a report by the Journal of Petroleum Technology (JPT), the well, situated in northeast Namibia, was drilled to a total depth of 2056 metres, reaching all geological targets.
The next step in the exploration activity is for a vertical seismic profile tool to be run to total depth to tie into the 2D seismic programme.
However, the joint venture between the Canadian oil explorer and the State-owned company did not reveal the contents of the well, but instead communicated that current operations were focused on well data capture and initiating data analysis.
As such, the Recon Africa-owned drilling rig is expected to remain on site until logging and coring operations are completed.
Meanwhile, JPT further reported that processing of the second phase of 761 km of 2D seismic data is near completion, where early results are being used to refine drilling locations for future stratigraphic wells.
Towards the end of September, Recon Africa said it had entered into a definitive purchase and sale agreement to acquire half of Namcor’s interest in the approximate petroleum exploration licence in Namibia.
The Canadian oil and gas company, which focuses on exploration and development in Namibia and Botswana, first signed the letter of intent with Namcor in early February.
At the time, the total consideration for the 5% carried interest was for an aggregate value of 31.8 million Canadian dollars or US$23.6 million (around N$426 million) in cash and stock.
According to Recon, completion of the transaction is expected to occur before the end of 2022 – and it is subject to the company receiving all necessary regulatory approvals, including, but not limited to, approvals from the mines and energy ministry.
The license covers 6.3 million acres of land in the Kavango basin.
According to a local oil industry executive, the deal significantly strengthens Namcor’s cash position in the short-term and gives Recon access to potential discoveries in the billions of barrels at 5%.
“Namcor is still looking at a substantial cash position in the long-term – not to mention the tax regimes – and Recon has to satisfy post-discovery. This is a win for Namcor as a carried interest partner. They have no exploration risk exposure with an upside of strong cash position benefits in the short-term, during exploration and in the long-term during production,” said Olayinka Arowolo, CEO of local oil explorer Nabirm.
In the meantime, a global independent research and business intelligence company has stated the two recent oil discoveries off Namibia’s coast by Shell and TotalEnergies account for over 85% of Africa’s total discovered volumes during 2022 and represent the largest global finds so far this year.
In a recent report, Rystad Energy stated that with these recent discoveries, Namibia has been thrust into the exploration spotlight.
This means the two major light-oil discoveries in the Orange basin are set to position Namibia at the forefront of Africa’s upstream future.
Rystad Energy also pointed out that between 2022 and 2025, more than 15 probes are expected to be drilled offshore Namibia, thereby making the country an exploration hotspot.