While still in its early stages, the initiative reflects growing momentum in Namibia’s offshore oil sector and both countries’ desire to build downstream refining capacity that matches their upstream ambitions.

The proposed refinery, which could cost between US$3 billion and US$5 billion, is being explored jointly by the Namibian and Botswanan governments. The two nations are evaluating potential sites, with Walvis Bay in Namibia widely viewed as the preferred location due to its deep-water port, established logistics infrastructure, and coastal access to export markets.

Ghanzi in Botswana, while also being considered in strategic discussions, is more likely to play a role as a storage and distribution hub rather than the refinery’s primary site. This regional configuration would allow Namibia to host processing operations while Botswana facilitates inland fuel transport and stockpiling.

The feasibility study comes at a time when Namibia is attracting global attention following major oil discoveries in the Orange Basin, where TotalEnergies and Shell have led exploratory successes. These finds, although not yet in production, have set the stage for long-term infrastructure planning—including refining, storage, and pipeline capacity.

Botswana, a landlocked country, is especially dependent on imported refined fuels. For both nations, the prospect of local refining capacity offers the promise of energy price stability, reduced supply chain risk, and value addition through local processing and employment generation.

However, experts caution that for the project to be economically viable, it must secure long-term offtake agreements and achieve a minimum capacity of 100,000 barrels per day (bpd)—substantially higher than current domestic demand. Namibia’s current consumption is around 25,000 bpd, highlighting the need for a regional or export-oriented business model.

The refinery project reflects a broader trend across Africa, where countries are seeking to move up the hydrocarbon value chain. Instead of exporting crude oil and importing expensive refined products, governments are increasingly prioritising integrated infrastructure that captures greater value domestically.

The Namibia–Botswana oil refinery also holds appeal for strategic partners and foreign investors seeking a foothold in a region with rising exploration success, stable governance, and a growing appetite for industrial development.

Source: Furtherafrica