Growing Projections For Namibia’s Petroleum Industry Amidst Covid-19


“At NAMCOR, money remains here, we employ people here, we pay taxes here and we have created value for our shareholder which is the state.”


Growing Projections For Namibia’s Petroleum Industry Amidst Covid-19

Under the helm of MD Immanuel Mulunga, indigenous petroleum corporation, NAMCOR, is intent on consolidating and growing its upstream and downstream activities while extending its reach across a variety of market sectors.

Late last year, NAMCOR entered the downstream business with its first retail service station at Hosea Kutako International Airport. What has been the impact of this new business line?

In spite of being a national company, we are quite a small company when it comes to the oil and gas industry in Namibia and we have a very small market share. We have been in the downstream sector for a long time but only recently did we enter the retail space. We believe that the biggest margins lie in the retail sector. Our vision is to grow and eventually capture most of the market share, dominating our national market. That is where we are heading.

What role will you be playing to support developments in alignment with the NDP5 and Vision 2030?

As a small player and State-Owned Enterprise (SOE), we want to start playing a bigger role by growing our market shares. We believe that our reason for existence is such that most of the profits that we make remain in the country instead of being repatriated. At NAMCOR, money remains here, we employ people here, we pay taxes here and we have created value for our shareholder which is the state. Currently, we are going to operate a new storage facility. It holds 70million litres and is near to completion at the moment. We will start operating and playing a role to enable the country to have strategic storage facilities. In this way, at least we have fuel for a set number of days and we are able to provide fuel to the state and security operators. As a national company, you must dominate your own market and that is exactly what we are doing.

Namibia is a very competitive petroleum exploration destination in the world. Currently, we have big international companies, such as Exxon Mobil, Total, Shell, Kosmos Energy exploring here. We are partners with all those companies with a 10% interest, or, in some cases, on bigger equity levels. So, we basically stand ready, once the discovery is made, which we believe it will in the next three years, to assist Namibia to become a petroleum-producing country and changing the fate of the country.

NAMCOR signed a N$3,2 billion fuel deal with Swakop Uranium which will include the supply of fuel and lubricants to one of the world’s largest uranium mines. How will this deal change amidst the outbreak of Covid-19?

That mine is one the largest uranium mines in the world. We were fortunate enough to leverage the position as national company, and compete with the other international marketing companies for that account. That contract is so big that it has made up 50% of our revenues at NAMCOR. We are quite excited by having landed there. It is a very good example of a government entity being able to compete in the market and beat bigger existing international marketing companies. We have been ramping up volumes and supplying the mines with our lubricants. Obviously, we want to replicate that business with other mines and large customers.

What are NAMCOR’s plans and visions for the future?

One of my objectives when I assumed the role of MD in 2015 was to reorganise the company and bring in experienced and knowledgeable people in the company. You can’t compete in this market if you don’t have the right people in the right positions. We successfully did that last year, restructuring the organisations and poaching a lot of new people from our private sector competitors. We believe that this is just the start, we are on our way to becoming a much bigger oil company in the downstream sector in Namibia. We have very ambitious growth targets. Our revenue target for this financial quarter was 100% increase and we want to double that again during this incoming financial year.




NAMCOR contributed towards helping each and every learner enrolled at Natangwe Uugwanga Primary School

NAMCOR contributed towards helping each and every learner enrolled at Natangwe Uugwanga Primary School, in the Oshikoto Region. The corporate entity donated several ICT equipments to the value of N$20,000.00.

Fuel Prices to Increase on the 1st of November 2017

The Ministry of Mines and Energy announces that fuel pump prices will increase on 1st November 2017 at 00h01.

The OPEC-non-OPEC producing countries’ Joint Ministerial Monitoring Committee (JMMC) has said based on the report of its Joint Technical Committee (JTC) for September 2017 that OPEC and participating non-OPEC producing countries have achieved a record high conformity level with the voluntary production adjustments, reaching 120 per cent.

The JMMC was established following OPEC’s 171st Ministerial Conference Decision of November 30, 2016, and the subsequent Declaration of Cooperation at the joint OPEC-Non-OPEC Producing Countries’ Ministerial Meeting on December 10, 2016, at which 11 (now 10 after Equatorial Guinea became a Member of OPEC ) non-OPEC oil producing countries cooperated with the 13 (now 14) OPEC member countries in a concerted effort to accelerate the stabilization of the global oil market through voluntary adjustments in total production of around 1.8 million barrels per day.

The resulting declaration, which came into effect on January 1, 2017, was for six months. The second joint OPEC-Non-OPEC Producing Countries’ Ministerial Meeting, held on May 25, 2017, decided to extend the voluntary production adjustments for another nine months commencing from July 1, 2017.

In September 2017, the OPEC and participating non-OPEC producing countries achieved an excellent conformity level of 120 per cent, the highest level since the start of the Declaration of Cooperation. This again underscores the resolute commitment of participating producing countries to cooperate towards the rebalancing of the market.

The JMMC expressed satisfaction with the overall results and encouraged all participating countries to continue on the path towards conformity, for the benefit of producers and consumers alike.

The JMMC noted that while some participating producing countries have consistently performed beyond their voluntary production adjustments, others are yet to achieve 100 per cent conformity. The JMMC took note of the recent developments in the market and expressed confidence that the oil market is moving in the right direction towards the objectives of the Declaration of Cooperation.

Indicative of these positive developments are the recent upward revisions for global oil demand growth in both 2017 and 2018. The JMMC will continue to monitor other factors in the oil market and their influence on the ongoing market rebalancing process. All options are left open to ensure that every effort is made to rebalance the market for the benefit of all.

The results of the latest fuel price review indicate that the average Free On Board prices per barrel remained stable for ULP 95 and for both Diesel grades. Barrel prices for refined oil traded at an average of US$ 68.239 for ULP95, US$ 68.379 and US$ 68.800 for Diesel 500ppm and Diesel 50ppm respectively. The Basic Fuel Price Unit Rate Slate calculations for the past month recorded under-recoveries on all the price regulated petroleum products. The under-recoveries recorded are sufficient enough to trigger an increase in local pump prices.

The average exchange rate moved up from N$13.1485 to about N$ 13.5553 per US$ over the period reviewed. The depreciation of the N$ against the US$ coupled with the fact that there was no upward adjustment for October 2017 prices despite the under-recovery situation back then contributed to the higher under-recoveries recorded during the current period.

Industry Margin

The latest Petroleum Activities Return (PAR) report indicates that oil companies are failing to generate sufficient returns on their investments in the petroleum sector and there is a need to adjust their margins to a level that would encourage sustainability and further investment.

The Ministry has, therefore, decided to increase the Industry Margin by 7 c/l from 84 c/l to 91 c/l on all the price regulated fuel products. The effective date for this adjustment is the 1st of November 2017.

The over/(under)-recoveries per product on the BFP import parity landed in Walvis Bay calculated as at 23 October 2017 are indicated below:

95 Octane Unleaded Petrol 52.686 c/ℓ
Diesel 500ppm 80.518 c/ℓ
Diesel 50ppm 79.126 c/ℓ


Fuel pump prices in Walvis Bay will increase as follows:

95 Octane Unleaded Petrol increase by 40 c/l (retail)
Diesel (all grades)  increase by 60 c/l (wholesale)

Thus,the new Walvis Bay pump prices will be:

95 Octane Unleaded Petrol  N$ 11.20 per liter
Diesel 500ppm  N$ 11.23 per liter
Diesel 50ppm  N$ 11.28 per liter

Fuel pump prices countrywide will also be adjusted accordingly.