Tapping giant oil targets offshore Namibia

Pancontinental is aiming to update its estimates of geological risking and prospective resources at its PEL 87 exploration permit.

Pic: Getty Images

Pancontinental Energy is aiming to update its estimates of geological risking and prospective resources at its PEL 87 exploration permit off the Namibian coast, where it remains confident of making a large oil discover from the world class Kudu host rock.

Veteran energy analyst Peter Strachan digs into the key facts around the project and why PCL is well placed to attract a new farm-in partner to lead drilling at the Southern African site.

Positive seismic data interpretation over Saturn Complex

Analysis of 3D seismic data acquired in 2023 enables identification of the Oryx and Hyrax oil prospects within the broader Saturn geological Complex at Pancontinental Energy's 75% held PEL 87 exploration permit, offshore Namibia.

Initial assessment of Prospective Resources finds that each prospect has potential for 100% gross, (2U) Best case 534 million barrels of recoverable oil with upside to 1.5 and 1.4 billion barrels recoverable respectively in the (3U) High case.

A further six leads identified within the Saturn Complex hold potential to yield a Best (2U) total of 537 million barrels of oil or a High (3U) total of 2.1 billion barrels.

Prospects are assigned an estimated Geological Chance of Success (GCoS) ranging from 19.7-22.5% while a GCoS ranging from 16.3-19.4% is estimated for leads.

QI offers possible resource upgrading

Ongoing in-house Quantitative Interpretation (QI) of seismic data against well data supports potential for an upgrade of estimated prospective resources during the September ’25 quarter.

Studies indicate good potential for high-quality reservoir systems with high net to gross of productive reservoir rocks. Confidence is further enhanced by hydrocarbon fluid effects coinciding with Class II AVO anomalies. These have been a successful marker for giant oil accumulations within the Orange Basin.

Pancontinental Energy (ASX:PCL) presently assumes an approximate 30% recovery factor to estimated oil-in-place, which may prove to be conservative given the permeability, porosity and flow rate results recorded from targeted reservoir rocks found further south in the Orange Basin.

Incorporation of the ongoing QI assessments may also increase estimates of GCoS over identified prospects and leads.

Farm-out action underway

Armed with its proprietary detailed seismic survey results and supported by flow rate and reservoir data from nearby oil and gas discoveries made by Galp Energia, a BP/Eni joint venture, Shell and TotalEnergies in Orange Basin permits to its south, Pancontinental is now in a strong position to attract a major farm-in partner to fund exploration drilling.

Similar characteristics of targets within the Saturn Complex mean that success at the initial prospect is likely to instantly upgrade GCoS for the entire prospect/lead inventory at PEL 87.

Surrounding permits deliver strong exploration success

Previous exploration success in neighbouring permits reveals a global hotspot for giant oil and gas discoveries showing abundant petroleum source material, along with sandstone reservoir rocks and traps sealed by good quality shale seals.

The Saturn Complex is interpreted to sit atop an oil "kitchen" so that only short distance lateral and vertical migration is required to charge target structures.

Recent step-out drilling at Galp Energia's Mopane discovery in permit PEL 83 immediately to the south of PEL 87, found more oil in reservoirs with high porosity and permeability, located 18 kilometres from the initial Mopane discovery well which flowed on test at 14,000bbl per day.

The initial 875 million barrels of 3C contingent oil equivalent (Mmboe) estimated for Mopane is anticipated to increase dramatically as further exploration and appraisal drilling is completed.

Further south, in PEL 85, the Azule Energy well, Capricornus 1-X, flowed light oil at over 11,000bbl per day on test. Further offshore to the west in deeper waters, TotalEnergies found a reported 5 billion barrels of oil at its Venus and Mangetti discoveries.

Inshore, BW Energy has outlined about 1.5 trillion cubic feet of gas at its discovery and plans to test satellite oil and gas prospects, aiming to develop an onshore gas-to-power project targeting the energy-poor South African market.

Discoveries in the Orange Basin are consistently characterised by strong AVO anomalism on 3D seismic survey data, proven to be a feature of seismic survey work carried out over Pancontinental’s permit. AVO anomalism is often associated with the presence of hydrocarbons within porous reservoir formations, as is the case in the Orange Basin.

Namibia’s National oil company holds a 10% interest in PEL 87, and the permit incorporates a standard royalty and tax system for petroleum.

At Stockhead we tell it like it is. While Pancontinental Energy is a Stockhead advertiser at the time of publishing, it did not sponsor this article.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Originally published as Tapping giant oil targets offshore Namibia