Leading international energy and infrastructure company, Sahara Group has indicated interest in exploring the energy sector of Africa’s second-biggest oil-producing country, Angola.
According to the Executive Director, Wale Ajibade, there is a new wave of opportunities arising in Angola’s oil and gas industry as the country’s transformative policies are luring international private firms. He also added that with the present condition of the country’s energy sector, there are enormous opportunities for both international and local companies.
Ajibade strongly opines that these kinds of partnerships will accelerate economic growth, give room for the exchange of knowledge and expertise, and also generate profit for both players.
There are currently a few regulatory reforms taking place after the country’s petroleum sector experienced a little downturn in the past years. The country recorded a low GDP growth rate from 5 percent in 2013 to 2.6 percent in 2016 due to fluctuating oil prices. Since then, inflation and unemployment have taken a stronghold on the South African country.
After this decline, President João Lourenço formulated policies set to transform the energy space, attract foreign investors and diversify the economy.
Some of these reforms include implementing incentives for investment in marginal fields and creating a natural gas regulatory framework. Lourenço also fired Isabel dos Santos, the then-CEO of the state-owned oil company Sonangol. He also named Diamantino Azevedo, the Minister for Mineral Resources and Petroleum after his experience as the Director-General of the Center for the Development of Mineral Resources of Eastern and Southern Africa from 2002 to 2006.
Azevedo, on the other hand, set up a task force to regulate the country’s mineral sector. This body is made up of the Ministry of Finance, the Office of the President, Sonangol, BP, Chevron, ENI, Esso, Equinor, and Total. As a country that is heavily dependent on oil, these reforms were needed to protect the sector from external shocks as well as secure the broader economy.
Angola is a major member of the Organisation of Petroleum Exporting Countries (OPEC) with an oil output of approximately 1.55 million barrels per day (bpd) and an estimated 17,904.5 million cubic feet of natural gas production. According to the World Bank’s 2018 economic outlook, Angola’s GDP will grow by 1.7 percent in 2018 and 2.2 percent in 2019.