Angola jumpstarts a new era for the oil and gas sector

41382386450 c6a7426bbd zA three-day oil and gas conference and exhibition, organised by Africa Oil and Power, was held at the Talatona Convention Centre, in Luanda from 4-6 June

The opening ceremony was honoured with the presence of H.E Joao Manuel Gonçalves Lourenço, the president of the Republic of Angola, who delivered the opening speech, at an attentive look of an audience, made of top officials of his cabinet, distinguish guests and personalities, CEOs of oil and gas corporations, investors and important players of the sector.

The conference aimed at showing the reforms underway in the oil and gas sector in Angola, its potential as a lucrative sector, and invites more investors. Therefore, the Angola Executive is determined in setting out a new era in the oil and gas industry with the creation in February 2019 the ANPG – Angola National Agency of Oil and Gas, which takes the role of concessionaire and the regeneration of SONANGOL, the state ran company, by focussing back to its core business activities, namely research, exploration, production and distribution of oil derivatives.

In his opening speech, President Lourenço has pointed out major steps to guide Angola’s turning point from import dependency of oil derivatives to a more sustainable and efficient oil producer country, “Unfortunately, several technical, operational and strategic constraints in recent years have led to a decline of oil production, which forced the Executive to take several measures to enforce the objectives and targets of the 2018-2022 National Development Plan for the oil sector”.

According to President Lourenço, the development and consolidation programme of oil and gas, designed for the 2018-2022 National Development Plan, comprises of three main objectives, namely to boost and intensify the replacement of reserves with a view to alleviating the sharp decline in production, ensure the self-sufficiency of refined products through the construction of new refineries and the expansion of the existing one as well as improve the networking distribution of fuels and lubricants throughout the national territory by increasing storage capacity.

The first day of the conference and exhibition has been of important announcements from the major players of the sector, SONANGOL and the ANPG - The Angola National Agency for Oil and Gas. SONANGOL in partnership with ENI have announced the award of the contract for the execution of the new platforming unit of the Luanda Refinery to the company KT - Kinetics Technology.

As per the announcement, the inclusion of this new unit at the Luanda Refinery will quadruplicate the high-octane gasoline production capacity of that unit and, consequently, reduce the need for imports. This contract will result in an increase in gasoline production.

The international tender was held by ENI, and the company winner is KT, which is a globally recognised EPC company with a strong technological profile. It is estimated that the project of the platforming unit will be completed in two and half years and the execution of this contract will employ about 600 local workers which during the construction phase more than 1000 jobs will be created, in mechanical, electrical, civil and instrumental fields.

The activities will be supervised by a joint team, specifically designated by SONANGOL and ENI, to ensure the highest standards of safety, quality, cost efficiency and compliance with the project schedule. This project results from the cooperation agreement signed by SONANGOL and ENI in 2018 for the re-launch of Angola’s refining sector. In compliance of that agreement, Eni successfully and safely completed the refinery maintenance campaign which resulted in an increase in its reliability and started a programme currently underway in Italy for the training of 40 SONANGOL technicians focused in the management of refineries.

The other announcement from SONANGOL is that of the signature of an agreement with UNITED SHINE for the construction of a crude oil refinery of high-conversion in Cabinda, the northern part of Angola. The project is financed by the Russian Bank VTB with US$1.5bn as confirmed by the Russian ambassador to Angola Vladimir Tararov.

The choice of United Shine is a result of a tender launched by SONANGOL in 2017 for the construction of a refinery in Cabinda province which should have a processing capacity of sixty thousand barrels of oil per day to produce derivatives such as diesel, gasoline, fuel oil and Jet A1.

On the other hand, the ANPG will carry out from 2-4 October, a bidding process of 10 blocks, nine in Namibe province and one in Lobito, Benguela province.

More investments have been announced for the sector by Pactrick Pouyanné, Chairman and CEO of TOTAL S.A, who started by saying that TOTAL operates in Angola for more than 65 years (since 1953). In 2014 TOTAL started operating block 17, which is, its major exploration block at the moment.

As per Mr Pouyanné, TOTAL employs approximately 1800 employees, of which 80 per cent are Angolan nationals. Last year alone, TOTAL launched three new projects with a budget of US$ 2.5bn. “We (TOTAL) will build 50 filling station country-wide in Angola, and, also intend to invest in renewable resources such as solar energy,” he said. TOTAL currently produces 600 000 bpd, which is 40 per cent of the Angolan production per day.

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