Expected to start commercial production in 2026, the Kudu Conventional Gas Development in Namibia’s Orange Basin is poised to be a game changer for the country’s energy sector. Last month, the government announced plans to collaborate with oil and gas supermajors TotalEnergies and Shell, alongside Kudu field operator, BW Energy, to facilitate a joint development plan for the asset.
The joint development plan will unite the technical capabilities of TotalEnergies, Shell and BW Energy to optimize the extraction and utilization of the Kudu field’s 1.3 trillion cubic feet (tcf) of natural gas. In addition to these proven reserves, TotalEnergies and Shell have made a series of significant discoveries in the deepwater section of the Orange Basin, identifying up to 8.7 tcf of gas and 11 billion barrels of oil.
Representing an $880-million investment, the Kudu Conventional Gas Development is currently in its Front-End Engineering and Design phase, with the Final Investment Decision expected in 2024. In October 2021, BW Energy acquired a semi-submersible rig – the West Leo – from offshore drilling company Aquadrill LLC, which is targeted for use as a production unit at the Kudu gas field. In May 2022, the company acquired additional 2D seismic data and is currently reviewing geophysical and well data from previous exploration activities to further identify additional exploration targets.
Development of the field will involve the drilling of three wells and will include the use of a floating production unit and subsea trees, with gas from the project set to be transported through a 170-km pipeline to an 885 MW combined cycle gas turbine in Uubvlei, approximately 25 km north of the town of Oranjemund in southern Namibia. Production from the field is forecast to peak in 2031 and will continue until the field reaches its economic limit in 2047.
Gas from the Kudu field will be purchased by state-owned NAMCOR to be used to generate electricity for domestic use in Namibia – which currently has an electrification rate of around 55% – as well as for export through Power Purchase Agreements with Zambia and South Africa. Poised to draw much-needed revenues to the Namibian economy, electricity generated from the project will contribute to Namibia’s exports of between 10,000 and 48,000 MWh to neighboring countries, diversifying the region’s energy mix while increasing the reliability of the electric grid in the Southern African Development Community (SADC).
Furthermore, a meeting last August between Namibia’s Minister of Mines and Energy, Tom Alweendo, and South Africa’s Minister of Electricity, Dr. Kgosientsho Ramokgopa, explored how the two countries can benefit from Kudu gas. Electricity generated from the gas-to-power plant will serve to alleviate the severity of load shedding in South Africa, while reducing the energy deficit in the country. Meanwhile, the project is poised to reduce carbon emissions and strengthen energy independence in southern Africa as a whole, with Zambia’s current electrification rate estimated at 46.7%, while Zimbabwe and Angola have electrification rates of approximately 49% and 43%, respectively.
As such, the Kudu Conventional Gas Development represents a pivotal opportunity for countries in the SADC to participate in resource sharing, with a view to attaining energy security. Gas from the field is poised to aid in Namibia’s socioeconomic development, while further stimulating exploration of the country’s resources. The export of surplus electricity from the combined cycle gas-to-power project is expected to advance economic growth in the southern African country, while driving the development and usage of sustainable and reliable energy sources within the region.
