Consolidated Infrastructure Group Ltd (CIL) has purchased a 30.5 per cent stake in Angola Environmental Servicos Limitada (AES), positioning itself to benefit from the business prompted by Angola’s predicted oil boom.
CIL purchased the significant stake in AES – 30.5 percent – for the sum of $15.3 million, while other investors also made purchases of smaller share holdings in the company, CIL announced.
AES is a waste management company that specialises in dealing with oil and gas waste. With the oil industry picking up in Angola, the acquisition sees CIL place itself in prime of position to reap the rewards of an increased demand for AES’ service offering.
“The number of oil rigs operating offshore in Angola will increase significantly over the next few years,” CIL explained in a statement revealing the purchase.
The company further added that legislative environmental requirements would boost demand for waste-management services, saying: “Changes to environmental legislation enacted in July 2012 will significantly enhance AES’s business.”
AES’ business in 2011 was already substantial, with the company recording sales at year-end totalling $42.6 million. Owning a 30.5 per cent stake, CIL stands to benefit if this figure should rise even further over the coming period.
Angola is the second largest oil producer in Africa, coming second only to Nigeria and its 2 million barrel per day output rate. Angola’s average daily production for 2011 was 1.75 million barrels of oil per day, accounting for 2.13 per cent of the world’s total crude production.
BP in its 2012 Statistical Energy Survey estimated that Angola houses 13.5 billion barrels of oil reserves, and with large oil corporations increasingly flocking to the country to get a place on the Angolan oil market it is likely that environmentally aware waste management companies will also be in great demand.
CIL shares spiked following the announcement, increasing 2.5 percent to the highest level in five years, trading at 14.55 rand ($1.64).