ExxonMobil, Shell weighing bids for Galp Energia’s “major” Mopane oil discovery offshore Namibia

Dinesh Nair and Kevin Crowley, Bloomberg May 21, 2024

(Bloomberg) – Exxon Mobil Corp. and Shell Plc are among oil and gas giants evaluating bids for a stake in Galp Energia SGPS SA’s major oil field offshore Namibia, according to people familiar with the matter.

Odjfell Drilling's Hercules semi-submersible rig

TotalEnergies SE and Equinor ASA are also among those considering acquiring the 40% stake Galp is seeking to sell in the Mopane offshore discovery, said the people, asking not to be identified as the matter is private.

Based on Galp’s recent “in place” estimates for 10 Bboe in the Mopane complex, the entire discovery could be worth around $20 billion, or potentially more, some of the people said. The Portuguese firm said in an April filing that the oil estimate is before drilling additional exploration and appraisal wells.

Galp, which is working with a financial adviser to sell half of its 80% holding in the Namibian asset, has called for first round bids in mid-June, according to the people. Shares of Galp were up 2.8% at 3:14 p.m. Tuesday in Lisbon, putting it on track for the biggest daily gain in about a month and giving the company a market value of €15.2 billion ($16.5 billion).

Deliberations are in the early stages and other bidders could emerge, while the Lisbon-based company could also decide to retain the stake if it cannot reach a final agreement with any of the parties, the people said.

Representatives for Galp, Shell, Exxon, Equinor and TotalEnergies declined to comment.

Galp shares jumped 21% after the company said in April that a well test “potentially” indicated Mopane could be an important commercial find in Namibia following the completion of the first phase of its exploration. The “in place” estimates for 10 Bboe are the first in a series of tests to determine how much oil the offshore discovery contains and is recoverable.

Galp’s oil finds have added to discoveries drilled offshore Namibia, with Shell and TotalEnergies also finding oil in the area in the past two years. The finds are helping to turn the sparsely populated country into a hotspot for exploration. While no fields have yet been given the green light for development, hopes are high in the country that an economic boom similar to that seen in Guyana could follow.

Officials from Namibia’s Ministry of Mines and Energy and state oil company Namcor visited Guyana late last year seeking advice about oil developments, while Patrick Pouyanne, chief executive officer of TotalEnergies, recently drew parallels between the two countries.

Galp is the operator of the Mopane license area with an 80% stake. Namcor, or National Petroleum Corp. of Namibia, and Custos each hold 10% stakes.