Namibia Strikes Oil: Galp Energia’s Major Offshore Discovery Sparks Market Surge

Shares of Portuguese energy firm Galp Energia surged over 20 percent in early trading on Monday following news of a significant oil discovery in offshore Namibia. Galp announced that initial exploration in the Mopane field suggests it could hold at least 10 billion barrels of oil.

Testing at the Mopane-1X and Mopane-2X wells revealed “significant light oil columns discovered in high-quality reservoir sands.” This discovery in the Orange Basin, where Shell Plc and TotalEnergies SE have also found oil and gas, marks a potential turning point for Galp.

The tests at Mopane reached maximum flow rates of 14,000 barrels per day, positioning it as a potentially lucrative commercial discovery. Financial institution Citi views this discovery as “totally transformational” for Galp, drawing comparisons to the major oil finds in Guyana’s Stabroek block.

Galp plans to sell half of its 80 percent stake in Petroleum Exploration Licence 83 (PEL 83), covering nearly 10,000 square kilometers in the Orange Basin. Namibia’s national oil company NAMCOR and independent exploration group Custos each hold a 10 percent stake.

The company intends to hand over control of the project’s development to a major international energy firm with strong project management expertise. Bank of America will oversee the sale process, expected to yield billions of dollars.

The Mopane discovery, one of the largest in the emerging basin, could catalyze Namibia’s oil industry. Despite the global push for clean energy, oil demand is forecasted to continue growing for decades, providing opportunities for countries like Namibia.

Oil prices have seen volatility, with geopolitical tensions in the Middle East influencing market sentiment. Bank of America has identified Targa Resources Corp. and Marathon Oil Corp. as stocks sensitive to oil price movements. Meanwhile, Goldman Sachs recommends Targa Resources and Chevron for dividend-seeking investors, forecasting significant dividend growth for both companies.