EDITORIAL: Ownership alone will not deliver oil benefits

Namibia does not need 51% ownership of every petroleum project to secure a fair share of its oil wealth. Such a stake would require the government to finance half of the enormous exploration and development costs while also carrying half the risk when wells fail.

Countries such as Australia and Canada have generated substantial public revenue from privately operated resources through royalties, corporate taxes and profit-based levies rather than compulsory majority state ownership. Ghana combines a relatively small state interest with royalties, petroleum income tax and additional entitlements. These examples show that the real issue is not the size of the government’s shareholding, but the strength of the fiscal system and the discipline with which revenue is collected and used.

Namibia should negotiate progressive royalties, tax exceptional profits, prevent companies from inflating deductible costs and publish every petroleum contract and payment. Namcor’s participation should remain commercially affordable and focused on projects with strong prospects.

The benefits must reach citizens through a transparent petroleum fund financing schools, hospitals, housing, water and technical training. Local procurement must be enforced, contracts divided into packages Namibian companies can undertake, and licence holders required to train and employ Namibians.

A 51% stake means little if mismanagement consumes the returns. Strong taxation, transparent spending and genuine local participation can deliver more.