Namibia’s hydrocarbon market
The Namibian government has launched a sovereign wealth fund to kickstart the sustainable development of the country’s hydrocarbon energy resources. On the back of two sizable oil and gas discoveries made earlier this year by supermajors, TotalEnergies and Shell, the launch signals a new era of sustainable investment in the southern African country.
With energy representing the backbone of the country’s economy, the government is focused on fast-tracking the development of Namibia’s oil, gas and hydrogen resources, while bridging key infrastructure financing gaps. Thus, the fund, dubbed the Welwitschia Fund, has been created to ensure that adequate financing is available to kickstart energy sector expansion.
Speaking at the launch in Windhoek, H.E. Hage Geingob, the President of Namibia, stated that, “We are looking forward to the prospects and opportunities that will emanate from the recent discoveries of oil and green hydrogen energy, which have the potential to further boost the fund’s capital.”
The fund will receive an initial capital injection of $16.3 million and invest 2.5% of the fund’s portfolio locally, collecting royalties from mineral resource sales, tax revenues as well as revenue generated from the government divesting from its investment holdings.
Meanwhile, elsewhere on the African continent, hydrocarbon resource-rich nations such as Angola, Botswana and Libya continue with their own comparable sovereign funds.