Shell Withdraws from Unviable Namibia Oil Discovery

Shell has announced a $400 million write-down related to an oil discovery offshore Namibia, deeming the resources in block PEL39 commercially unviable. This setback poses challenges to Namibia's ambitions to establish itself as a crude oil producer, despite initial excitement from previous discoveries by Shell and TotalEnergies. CEO Wael Sawan highlighted the technical difficulties due to the area's lower rock permeability and high natural gas content, complicating extraction efforts. In addition to the Namibia write-down, Shell will also incur a $300 million write-off primarily linked to exploration licenses in Colombia. The company's updated trading report is expected ahead of its fourth-quarter results on January 30. The write-down follows a series of drilling efforts where Shell and partners drilled nine wells over the past three years.