TotalEnergies’ enormous Venus-1 discovery offshore Namibia holds at least 3 billion barrels of recoverable oil and is Sub-Saharan Africa’s biggest ever oil find, according to a confidential report from an industry-leading consultant.
Upstream broke the news on the huge discovery last week, just a month or so after revealing exclusively that Shell had also made a big oil discovery in Namibia with its Graff-1 wildcat.
Venus’ scale is such that the base-case scenario could see it producing about 250,000 barrels per day via a floating production, storage and offloading vessels with more FPSOs to follow.
Huge reserve numbers are being bandied about for the ultra-deepwater find in the Orange basin, with one source familiar with the TotalEnergies find saying it is the largest discovery made by the French supermajor for some 20 years.
Venus-1 was drilled to a total depth of 6296 metres by the drillship Maersk Voyager in Block 2913B, hitting 84 metres of net pay in a high-quality Lower Cretaceous sandstone reservoir that contains light oil and associated gas.
Well partner Impact Oil & Gas said the results surpassed pre-drill expectations.
A confidential report from Edinburgh-based Wood Mackenzie said the original recoverable resource estimate for the prospect before drilling the probe stood at between 1.5 billion and 2 billion barrels of oil.
However, WoodMac’s note for clients said it now “conservatively estimates recoverable oil volumes of over 3 billion barrels,” pointing out that “Venus is set to become Sub-Saharan Africa’s biggest ever oil discovery.”
This would see it surpass TotalEnergies’ Girassol and Dalia fields in Block 17 in Angola and its Akpo and Egina fields in Nigeria.
According to the report, Venus “cements Namibia’s position as the next deep-water exploration hotspot”, highlighting that the country — which has a population of only 2 million — “could find itself (being) the third largest oil producer in Sub Saharan Africa within a decade”.
Upstream was told the reservoir could cover about 600 square kilometres, while WoodMac added that the net pay encountered is on a par with ExxonMobil’s giant Liza discovery in Guyana.
“Exploration potential beyond Venus is equally enticing,” stated the report, with Upstream told by a southern African source that the Venus West prospect in the same block “is as big as Venus”, with the possibility that the two structures “could be connected”.
WoodMac noted that Venus-1 has increased the chances of success on several nearby prospects, pointing out that TotalEnergies will exercise one or more options on the Maersk Voyager to appraise the discovery in order to determine reservoir variability.
Given the scale of the discovery, Venus will be developed over multiple phases with several FPSOs, suggested the consultancy, with phase one potentially exploiting 920 million barrels.
However, a veteran FPSO expert told Upstream that the water depth of 3000 metres will pose a challenge for a turret mooring system, while the weight of the risers carrying the well fluids from the seabed to the FPSO turret will pose an additional technical challenge.
This source also said that weather conditions in Block 2913B can be harsh, so the mooring system will need to be designed with this in mind.
This point was reinforced by a well-watcher familiar with Venus-1 who said even the high-specification Maersk Voyager had to stop operations for about four days because of heavy weather.
Currently, the operator's development strategy is unclear, with Upstream told by a source with knowledge of Venus that a smaller FPSO-based early production system could offer a lower-cost way to understand the site's metocean conditions as well as the reservoir.
Drilling Venus-1 was a challenge, said the source, who claimed the well suffered from at least two high-pressure ‘kicks’.
WoodMac estimates the net present value of Venus phase one to be $3.5 billion at $50 oil price, generating an internal rate of return of 22% while breaking even at $31 per barrel. At a $70 oil price, the project’s NPV hits $6.3 billion, with IRR reaching 30%.
WoodMac assumes first oil could flow in 2028 from an initial development via more than 35 production wells tied back to a leased FPSO.
An FPSO market watcher suggested this could call for the conversion of an ultra-large crude carrier.
The “estimated total investment will be over $13 billion and take seven years to pay back”, stated the report.
When both Venus and Shell’s Graff field are in production, the consultancy noted that Namibia could accrue over $3.5 billion annually in royalties and taxes.
WoodMac noted that Venus’ associated gas could displace diesel power generation which currently accounts for 30% of Namibia’s grid-connected supply, but also suggested the domestic market is under-developed so a more regional solution may be needed.
A regional exploration source speculated that another possibility could see gas from Venus fed into BW Energy’s nearby — but long-delayed — 1.2 trillion cubic foot Kudu gas project from where feedstock from both fields could be sent to a power plant planned at Oranjemund.
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