Russia joins Namibian oil hunt

GAZPROM, the Russian heavyweight in gas and oil exploration, plans to scrutinise all available hydrocarbon data on Namibia to decide where they are going to kick off their search for black gold here.

‘Get used to seeing our faces much more often in Windhoek,’ Gazprom International Chief Boris Ivanov said at a business lunch yesterday, announcing that the company will open a local office by year-end.Ivanov said Namibia has ‘great potential hydrocarbon resources’ and that the country holds ‘strategic interest’ for Russia.He was part of Russian President Dmitry Medvedev’s business delegation visiting Namibia until this morning. Medvedev was the chairman of the board of Gazprom before he became president.When The Namibian spoke to Mines and Energy Minister Erkki Nghimtina last night, the Minister could barely contain his excitement.’I’m very confident. These guys are the experts,’ he said.According to Nghimtina, it is only a question of giving all the exploration data available to Gazprom so that they can prioritise. So that they can determine that we start with this one,’ he said.Nghimtina said the memorandum of understanding (MoU) signed yesterday between Gazprombank, owned by Gazprom, and the National Petroleum Corporation of Namibia (Namcor), ‘has opened the way to go into business’.Ivanov told the lunch meeting that Gazprom, through Gazprombank, is also very keen to get involved in the construction of an 800MW gas turbine power plant at Walvis Bay, part of the gas-to-power Kudu Gas project.’It is quite a nice, sexy little project,’ Ivanov said, adding that Gazprom would like to get involved as soon as possible.Namcor Managing Director Sam Beukes was cautiously optimistic about this development.Gazprom’s involvement must still be negotiated, he told The Namibian.Minister Nghimtina, however, welcomed Gazprom’s enthusiasm. The successful completion of Kudu will boost Namibia’s power supply tremendously, he said.Beukes also indicated that Gazprom might partner up with Namcor in some of their gas and oil exploration blocks.He also said the Gazprombank deal could pave the way for Namcor to lay its hands on US$20 million to fight off their financial problems.Three months ago Namcor said it needed a N$200 million injection after the company had incurred significant losses last year.Beukes said the agreement will help Namcor access US$20 million and the Russian energy company will also assist them technically for oil and gas exploration.’This is the beginning of setting Namcor up to strengthen its balance sheet. For now it is a MoU to explore opportunities and substantive agreements will come with time, but Gazprom wants to play a bigger role in Kudu gas field,’ Beukes said on the sidelines of the talks between Russia and Namibia.Namcor has a 10 per cent share in the Kudu licence alongside Tullow Oil (70 per cent) and Itochu Corporation (20 per cent).The Kudu natural gas deposit, some 130 km off the southern coast of Namibia, is the country’s only commercial hydrocarbon deposit to date.The deposit has proven natural gas reserves of over 40 billion cubic metres.’Kudu is our only tangible asset for now and the Russian delegation is willing to start help us access our resources,’ Beukes said.The deal was signed a day after Gazprom sealed another one worth US$2,5 billion with Nigeria’s state-operated NNPC to further strengthen Russia’s role in supplying natural gas to Europe.More dealsTwo other agreements – one to promote reciprocal investment protection and another to co-operate in the field of fisheries – were signed yesterday.During yesterday’s official talks Medvedev called for more trade between his country and Namibia, adding that they want to intensify their partnership with Africa.’We should promote activisation of trade and economic ties. The first visit of the Russian president should open a qualitatively new stage in our relations,’ he said.President Hifikepunye Pohamba agreed.He said that Namibia is also keen to strengthen its co-operation with Russia and build what he termed a ‘durable economic partnership’.Pohamba said Namibia wants secure access for the country’s products to Russia and urged Russia to lower tariffs on metal and farm goods.Meanwhile, the Russian news agency Itar-Tass has quoted Russian presidential aide Sergei Prikhodko as saying the Russian business community has been displaying growing interest of late in entering the promising market of Namibia.’In this connection during the visit the sides will discuss possibilities for the expansion of Russian investment participation in major projects of the Namibian economy, in particular, in the sphere of the prospecting and development of mineral deposits, hydrocarbons, electric power industry, transport and tourism,’ Prikhodko said.According to him, one of the promising co-operation spheres is the energy industry, from hydropower to atomic power. ‘We are ready and are even offering at the expert level co-operation programmes, so we will speak about this,’ the presidential aide said. Medvedev will end his four-nation visit to Africa with a final stop in Angola today.