“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.