Internationally the sentiment is to move away from fossil fuel, given that globally we teeter on the tipping point and are likely to exceed the temperature increase limits which science have set and which are represented by the Paris Agreement. Namibia is a signatory to the Paris Agreement, having committed to reduce its business as usual GHG emissions as a country by 91% by 2030. One of the pillars of the Namibian strategy to achieve this goal is to follow a national sustainable energy strategy which looks to introduce new emissions-reducing technologies and energy efficient practices. However, at the same time Namibia is committed to its long-term development vision set out in Vision 2030 which strives to achieve a prosperous and industrialised Namibia.
All eyes are on Namibia as she navigates the path to becoming a regional energy powerhouse and petroleum producing nation within this context, furthering the sustainable development of her resources, while still protecting her people and meeting global climate goals..
The development of the petroleum industry and its surrounding ecosystem will need to be cognisant of Environmental, Social and Governance (ESG) factors. Investing into the petroleum industry in the age of ESG requires a thorough understanding of both risks and opportunities which can be organised under the headings of E, S and G, as well as how an African just energy transition and a nation's sovereign right to exploit its natural resources fits into this picture. Industry Participants, lawyers, financiers and banks will need to be well versed to be able to face this difficult task.
From an Environmental perspective, the risks arising from potential public interest and environmental litigation in conducting petroleumrelated operations will have to considered, as well as risks which offshore operations can pose in relation to habitat degradation and loss of biodiversity. This should be coupled with an emphasis on ensuring that the required public participation processes to be undertaken during environmental impact studies are conducted to their fullest extent. However, the Environmental factor also creates opportunities, for petroleum producing companies and offshore service providers who can decarbonise their operations by leveraging Namibia's world-renowned solar and wind resources. By investing in green energy, trading in carbon credits and funding green schemes (such as reforestation programmes and carbon sink funds) companies can ensure that their operations have a positive environmental impact in Namibia (and worldwide).
From a Social perspective, the envisioned industrialisation of Namibia and the expansion of port infrastructure and the surrounding towns of Walvis Bay and Luderitz will positively impact Namibian society. Further, the development of practically implementable local content policies by Government and local content development plans by individual companies will have a major impact on the availability of local skills and expertise to service the emerging petroleum industry. By adopting a “learning by doing” approach, knowledge transfer to Namibians can be ensured – both alleviating national unemployment rates and inequality in Namibian society -, while also recognising the importance of the highly specialised skills which expatriates will bring into the country. This opportunity therefore provides not only direct jobs in the construction and development phase but sustainable job creation for a new generation of skilled Namibians.
Lastly, from a Governance perspectives, the importance of developing and adopting strong corporate governance and robust anti-corruption policies cannot be understated. Namibian companies involved should ensure that contracts with offshore parties are not one-sided or extractive and that in terms of their own governance arrangements they carefully guard against any form of corruption while robustly tasking their directors to ensure sustainable business which is cognisant of the impact of operations on both community stakeholders, the environment and labour.
From a policy perspective, the introduction of appropriate legislation to govern the Welwitschia Sovereign Wealth Fund will be essential to ensuring that the legacy left by Namibia's petroleum boom will have a positive impact for all Namibians for generations to come, thereby transitioning Namibia from one of the most unequal nations worldwide ridden by energy poverty, to an industrialised nation exemplified by prosperity for all while still protecting Namibia's national treasure, its environment.
EXPERIENCE PETROLEUM AND ENERGY-RELATED ADVICE
CONDUCTING DUE DILIGENCE INVESTIGATIONS IN RESPECT OF NAMIBIAN PETROLEUM EXPLORATION LICENCES
Advising international oil companies in respect of the potential acquisitions of petroleum exploration licences in the Orange Basin in Namibia, in particular PEL 2913B and 2912. The due diligence investigation included matters relating to the review of the existing petroleum agreement and the commitments in respect of local content and environmental protection contained therein.
CLEAN ENERGY TOOLKIT
Preparation of “Clean Energy Tool”, setting out various regulatory matters relating to the generation, transmission, distribution and export of renewable energy sources in Namibia, including matters relating to public procurement, financing and incentivization of renewable energy by the state, taxation, dispute resolution, exchange control, third party access rights to the national grid and related matters.
DECARBONISATION OF OIL PRODUCTION
Advising international oil company in respect of the Namibian regulatory framework governing renewable energy generation in Namibia, to assist client in the evaluation whether to develop renewable energy facilities alongside its petroleum activities in the country.
FARM-IN
Advising international oil company in relation to a farm-in agreement for purposes of the acquisition of participatory interest in petroleum exploration licence, and advising on relevant Namibian law administrative matters.
GREEN HYDROGEN
Appointed to advise a bidder in the Southern Corridor Development Initiative's request for proposals in respect of establishing a green hydrogen project in Namibia, and advising bidder following granting of the award in respect of the establishment of a fully vertically-integrated green hydrogen project, including the negotiation of the Feasibility and Implementation Agreement with the Government of Namibia.
LOCAL CONTENT POLICIES AND FOREIGN INVESTOR LAWS
Advising various new entrants, including international oil companies and offshore service providers, on current legislation and policies in place regulating local content requirements in the petroleum industry, as well as legislation relating to foreign investments. This includes advice relating to anticipated legislation which may have an impact on investments into Namibia, such as the National Equitable Economic Empowerment Bill, 2015, the Namibia Investment Promotion and Facilitation Bill, 2021 and the Special Economic Zones Bill.
REIPPP
Advising multiple, international independent power producers during the bidding process of the biggest national Independent Power Producer program ever attempted in Africa, named the Renewable Energy Independent Power Producers Procurement Programme in South Africa. The REIPPP Programme is particularly significant because it contributes towards the country's commitments to transition to a low carbon economy.
ESG IN PETROLEUM AND MINING SECTOR
REFORMING PETROLEUM AND ENVIRONMENTAL LAWS
Advised a government in East Africa with respect to the updating and reforming of its petroleum and environmental laws, including reviewing and standardising key policy, legal and regulatory documents; development of petroleum sector toolkits, including operational guidelines, standard documents and model agreements; and provision of capacity building services and workshops to professional staff, working within the Extractive Sector's Regulatory Institutions.
SECTORAL MINING TOOLKIT
Advised a government in East Africa on the development of a one-of-a-kind Sectoral Mining Toolkit which sets out the procedures and provides model documentation used in mining transactions which covered social, mining and environmental regulation aspects.
TOOLKIT ON LOCAL DEVELOPMENT AND COMMUNITY ENGAGEMENT
Advised an International Bank in compiling a first-of-its-kind Toolkit on Local Development and Community Engagement to be used by various African governments who would like to reform or improve their mining and environmental laws. The Toolkit covered numerous topics including, but not limited to community engagement and consultation on the environmental and social impacts of mining activities; local employment and training obligations aimed at addressing the pervasive issue of unemployment and poverty alleviation; and infrastructure development to ensure sustainable, high-impact and long-term growth and benefits for host mine communities who are most directly impacted by mining activities.
ESG TRAINING AND SUSTAINABLE FINANCE
CAPACITY BUILDING AND TRAINING
Mandated in the financial services industry to provide capacity building and training to transactors deploying and negotiating sustainable finance instruments. We have provided capacity building training in English and French to professionals across the continent. Our experts are regularly invited to speak both in Africa and internationally.
ESG POLICY DEVELOPMENT FOR CORPORATES
Providng expert and highly specialised advice to Africa's largest asset manager, ensuring that their ESG framework and related ESG operational policies are best of breed and in line with international best practice.
We assisted multiple large entities and other financial institutions in developing their ESG policies and procedures and providing training to ensure integrated implementation.
SUSTAINABLE FINANCE
Acted as both lender and borrower counsel in raising and securing syndicated sustainability-linked borrowing base facilities, sustainability-linked real estate facilities, and green loans.
BLUE BOND
ENS is currently advising on the establishment of Namibia's first corporate Blue Bond Note Programme, which is being developed as a ‘use-ofproceeds' note programme intended to fund the development and management of sustainable kelp forests off the coastline of Namibia.
DUE DILIGENCE AND ESG REPUTATION MANAGEMENT
Conducting due diligence for various acquirors and financiers to minimize reputational, operational and legal risks in the medium to long term.
Advising in respect of regulation pertaining to Environmental, Social and Governance considerations in different sectors, assisting clients to identify risks arising from non-compliance and develop and implement remedial plans.
PUBLIC INTEREST LITIGATION
We have advised clients on the potential risk for climate change or public interest litigation in Namibia, which may arise from conducting seismic studies as part of offshore petroleum exploration activities.
CARBON CREDITS AND TAXATION
CARBON CREDIT OWNERSHIP
Provided advice in relation to carbon credits/ offsets generated or potentially to be generated under the South African government's Renewable Energy Independent Power Producer Procurement Programme.
CARBON CREDIT TRADING
Procuring an advance tax ruling from the South African Revenue Service regarding the tax treatment of a legal structure executing a series of carbon credit generating initiatives, otherwise known as a programme of activities, as part of the Clean Development Mechanism.
CARBON TAX RETURNS
Advised a number of carbon taxpayers (such as mines and retailers) on their annual tax return submissions to the South African Revenue Service.
CARBON TAX
Contributing to the Concise Guide to Carbon Tax and the Comprehensive Guide to Carbon Tax in South Africa.
FORENSIC AND ANTI-CORRUPTION CAPABILITIES
Fraud and corruption pose significant and material risks to the sustainable governance of any relevant business. Our dedicated forensics team, consisting of forensic lawyers, accountants, investigators, digital forensic experts and specialist fraud prosecutors, is highly skilled in complex, large-scale investigations into white collar crime across Africa and beyond.
We offer extensive expertise in terms of anti-bribery compliance across Africa and provide a full suite of anti-corruption compliance support, including compliance advice, fact-finding investigations, due diligence screening, risk assessments, remediation and control review, control enhancements, training and monitoring to help our clients to ensure compliance and prevent corporate crime.
AFRICA-WIDE FINANCE WORK
Advised a club of local lenders on secured term funding to a Sub-Saharan African state owned oil company.
Advised various funders in relation to secured long-term development funding and commercial bridge funding to an emerging South African integrated renewable energy producer in relation to a helium gathering and liquefaction project.
Advised a club of lenders on secured committed and uncommitted borrowing base facilities for the import and onward export of oil to various jurisdictions in Africa via the ports of Durban in South Africa and Beira in Mozambique.
Advised a South African commercial bank on an import financing facility for a Dubai based trading firm for the importation of petroleum products into Tanzania (petroleum products secured whilst stored in in-country tank farms under collateral management).
Advising a South African commercial bank on an import financing facility for a Swiss based trading firm for the importation of petroleum products into South Africa, and their on-sale to South African based offtakers.
Advised a South African commercial bank on an import financing facility for a Singapore based trading firm for the importation of gasoil into Matola Port, Mozambique (petroleum products secured whilst stored in in-country tank farms under collateral management).
Advised a Development Finance Institution and leading European commercial bank on the financing of the importation of fuels by a Dubai based energy trader into Mauritiania.
Advised an African based Development Finance Institution and a UK based trade finance fund on the financing of a Liberian based oil trader's importation of fuel products from Nigeria to tank storage facilities in Monrovia, Liberia.
Advised a club of lenders on secured committed and uncommitted borrowing base facilities for the import and onward export of oil to various jurisdictions in Africa via the ports of Durban in South Africa and Beira in Mozambique.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
