U.S. Ambassador hosts Angolan delegation to explore joint E&P opportunities
NEW ORLEANS – U.S. ambassador to Angola, the Hon. Nina Maria Fite, hosted a delegation of top Angolan oil and gas officials to explore opportunities for the two nations to collaborate on the next phases of Angolan energy development.
Meeting at the Louisiana Gulf Coast Oil & Gas Exhibition (LAGCOE) in New Orleans, Ambassador Fite was joined by Sebastião Pai Quierdo Martins, the CEO of Angolan state-owned E&P company Sonangol, Belarmino Chittargueleca of Angola’s National Oil and Gas Agency (ANPG), and Clay Neff, Chevron’s president of Africa and Latin American E&P operations.
Since 2008, Angola’s oil production has fallen from a little over 2 MMbpd to approximately 1.5 MMbpd in 2017, with declines in legacy fields projected to continue. To meet Angola’s current and future energy needs, the government has made important changes to how it manages the ownership and utilization of the nation’s oil and gas reserves, focusing on creating a more accountable business environment.
“Angola is improving its business climate to help grow the economy,” Ambassador Fite said, noting that the Angolan administration supports fiscal management and fiscal responsibility, and the development of a sustainable energy mix.
Chief among the changes was the establishment of the ANPG in January of this year, to handle lease concessionaire responsibilities independently from Sonangol. “The goal of the ANPG is to promote transparency, eliminate conflicts of interest, simplify business processes, and promote a business environment that maximizes state revenue,” said Chittargueleca.
In its first action as Angola’s lease manager, the ANPG is auctioning 55 new offshore blocks, the first lease sale the country has held in seven years. With the roadshow still underway, Chittargueleca commented that the results thus far were “positive.”
Sonangol is taking on its own ambitious program, committing to a top-down restructure to “become sustainable as a reference company in the African continent,” Quierdo Martins said. His plan includes the farm-down of onshore and offshore blocks, utilization of two newly-acquired ultra-deepwater drillships, a series of gas projects, addressing shortfalls in refining and storage capacities, and privatizing non-core businesses worldwide.
“We can currently only meet about 20% of our refined product needs, so we intend to increase it with three new refineries, filling the other 80% of demand by adding 365,000 bpd of capacity,” said Quierdo Martins.
Chevron has been operating in Angola for the past 60 years, and Neff agrees that positive changes are possible when U.S. and Angolan interests are aligned. “The government is seeking out industry expertise to help design thoughtful, practical” energy sector reforms, Neff observed, saying that the “operationalizing” of reforms is speeding realization of benefits, both to the government and the Angolan people.
“Of Chevron’s 4,500 employees in Angola, 90% are native Angolans, and each Chevron job supports 61 additional Angolan jobs,” Neff said. Citing his personal experience living and working in the country, he felt optimistic about the potential the changes at Sonangol and ANPG represent. “Chevron has been here for 60 years, and we look forward to another 60 more,” Neff said.