What makes the Merlin-1X discovery significant for the global oil market?

The Merlin-1X discovery confirms that the prolific oil-bearing trends in Namibia's Orange Basin extend further than previously proven. It reduces geological risk for the entire region, suggesting that Namibia could become a major source of non-OPEC deepwater supply by the end of the decade, offering high-quality, light sweet crude to global refiners.

Who are the partners involved in PEL 0039, and what are their stakes?

The license is operated by Shell with a 45% working interest, in partnership with QatarEnergy, which also holds a 45% stake, and Namibia's state-owned oil company, NAMCOR, which holds the remaining 10% carried interest. This partnership combines the deepwater operational expertise of a supermajor with the financial backing of one of the world's largest LNG exporters.

What are the next technical steps for Shell and its partners at PEL 0039?

The partners will integrate the well data into their existing 3D seismic models to map the lateral continuity of the reservoir. This will be followed by appraisal drilling to establish the commercial boundaries of the field and flow testing to evaluate the reservoir's productivity before making a formal Declaration of Commerciality.

Offshore Technology · June 10, 2026 (Jun 10) · 1 min read

Shell-led partnership finds oil at Namibia’s PEL 0039 with Merlin-1X

Qatar Energy Shell plc

Analysis

AI-assisted analysis · reviewed by Yuri Kan

Shell's successful drilling of the Merlin-1X well in Namibia's Orange Basin marks another significant hydrocarbon breakthrough in one of the world's hottest offshore exploration frontiers. This discovery further solidifies the commercial viability of the PEL 0039 block, reinforcing the region's status as a world-class oil province. The result boosts the strategic position of the Shell-led joint venture, signaling that the initial successes in the basin were not isolated incidents but part of a massive, interconnected petroleum system.

Key Facts

The Merlin-1X exploration well was successfully drilled within the Petroleum Exploration Licence 0039 (PEL 0039) offshore Namibia.
Supermajor Shell operates the PEL 0039 license in partnership with Qatar's state-owned QatarEnergy and the National Petroleum Corporation of Namibia (NAMCOR).
The discovery was made in the deepwater Orange Basin, a prolific geological play that has recently yielded multiple multi-billion-barrel discoveries.
While specific reservoir thickness and resource volumes have not been fully disclosed, the well successfully encountered light oil in the targeted intervals.
This drilling campaign is part of a multi-well exploration and appraisal strategy designed to map out the full potential of Shell's extensive Namibian acreage.

Background & Context

Namibia's offshore Orange Basin went from an overlooked frontier to a global exploration hotspot in 2022 following back-to-back giant discoveries by Shell (Graff-1) and TotalEnergies (Venus-1). These initial successes proved the existence of highly productive, light-oil-bearing Cretaceous reservoirs. Since then, international oil companies have rushed to secure acreage and drilling rigs, eager to delineate what is estimated to be billions of barrels of recoverable oil equivalent in the region.

Market Impact

This discovery strengthens Shell's dominant position in the Orange Basin and validates QatarEnergy's aggressive global exploration strategy. For Namibia, the Merlin-1X success accelerates the country's timeline toward becoming a major oil-exporting nation, which will require massive infrastructure development and the establishment of a new regulatory framework. The continued high success rate in this basin will likely draw further capital away from mature, higher-cost offshore basins globally, shifting the focus of deepwater exploration spending toward Southern Africa.

What to Watch

The joint venture will now focus on analyzing the pressure and fluid data gathered from Merlin-1X to determine the exact flow potential and commercial scale of the find. Expect Shell to fast-track appraisal drilling in the immediate vicinity while simultaneously advancing engineering studies for a potential joint development hub. Industry observers will also watch for NAMCOR's strategy regarding its carried interest and how the Namibian government manages the transition toward its first commercial offshore oil production.

Frequently Asked Questions

What makes the Merlin-1X discovery significant for the global oil market?: The Merlin-1X discovery confirms that the prolific oil-bearing trends in Namibia's Orange Basin extend further than previously proven. It reduces geological risk for the entire region, suggesting that Namibia could become a major source of non-OPEC deepwater supply by the end of the decade, offering high-quality, light sweet crude to global refiners.
Who are the partners involved in PEL 0039, and what are their stakes?: The license is operated by Shell with a 45% working interest, in partnership with QatarEnergy, which also holds a 45% stake, and Namibia's state-owned oil company, NAMCOR, which holds the remaining 10% carried interest. This partnership combines the deepwater operational expertise of a supermajor with the financial backing of one of the world's largest LNG exporters.
What are the next technical steps for Shell and its partners at PEL 0039?: The partners will integrate the well data into their existing 3D seismic models to map the lateral continuity of the reservoir. This will be followed by appraisal drilling to establish the commercial boundaries of the field and flow testing to evaluate the reservoir's productivity before making a formal Declaration of Commerciality.

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