Resource billions test local firms

Contractors risk missing out on a wave of infrastructure investment expected to accompany the country's emerging oil, gas, green hydrogen and mining industries, research firm Simonis Storm has warned.Large infrastructure projects are likely to rely on international engineering, procurement and construction (EPC) contractors for major civil, mechanical and process packages, leaving domestic firms competing for sub-tier opportunities, Simonis Storm said."The policy imperative is to maximise local participation through genuine skills transfer agreements, in-country fabrication requirements where viable, and labour absorption programmes scaled to energy-sector volumes," Simonis Storm said."Without deliberate intervention, the construction multiplier from this pipeline will accrue disproportionately to international contractors rather than to the domestic economy," it added.The warning comes as Namibia develops a pipeline of large-scale energy and mining projects that could significantly increase demand for construction, engineering and related services.Hyphen Hydrogen Energy's proposed Phase 1 project would be the country's largest infrastructure commitment if it reaches a final investment decision (FID), Simonis Storm said.The project targets 2 gigawatts of electrolysis capacity and has an estimated capital expenditure of more than US$10 billion (N$162 billion) at full build-out, according to the research firm. Civil, structural and mechanical construction could account for 35% to 40% of total capital expenditure, implying US$3.5 billion to US$4 billion in potential direct construction demand."At mid-2026, a formal final investment decision had not been taken, with the timeline contingent on European offtake agreements, multilateral financing close, and export certification certainty under the EU Renewable Energy Directive," Simonis Storm said.Impact of mining Mining is also expected to provide a nearer-term source of infrastructure and construction demand."Namibia's mining sector provides an additional and nearer-term construction demand layer across multiple commodity classes," Simonis Storm said.Paladin Energy's Langer Heinrich uranium mine resumed production in 2024 following a decade-long suspension and is targeting annualised production of 6 million pounds of uranium oxide at full capacity, requiring ongoing plant and infrastructure investment, it said.Bannerman Energy's Etango-8 uranium project has advanced through permitting and pre-development engineering, while lithium and copper developments could provide additional greenfield infrastructure opportunities, Simonis Storm said.The resulting investment is also expected to affect residential and commercial construction indirectly through higher employment and demand in mining and coastal centres."Elevated skilled labour demand in coastal and mining-town markets, upstream supply chain activity, and household income multipliers" could lift residential demand in Windhoek, Swakopmund, Walvis Bay and Lüderitz, Simonis Storm said.But Namibia's construction industry may struggle to absorb the scale of investment envisaged."Namibia's construction sector faces a genuine capacity challenge in absorbing this pipeline," Simonis Storm said, pointing to limited subcontractor depth, shortages of specialist trades and restricted developer financing.The firm said large projects would require international EPC contractors for major packages, increasing the importance of policies aimed at ensuring local businesses gain access to procurement opportunities and skills development.

Resource billions test local firms

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Namibian Sun 2026-08-19

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Resource billions test local firms

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Namibian Sun 2026-08-19

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