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Oil and Gas underpin dynamism of the Angolan economy

The Angolan oil sector will remain dynamic over the next few years, with more prospecting and production, whilst natural gas is starting to contribute to economic growth, according to Portuguese bank BPI.

The Angolan government plans to increase average daily oil production to 1.84 million barrels this year, or 60,000 more than in 2012, but its aims go beyond this and include counterbalancing pressure to lower prices, according to the latest report on Angola from Portuguese bank BPI.

“Over the next few years, the sector will remain dynamic and Sonangol’s aim is to increase production to 2 million barrels per day in 2015, by granting prospecting licenses for new oil fields,” said the report written by economists Carmen Camacho and Paula Gonçalves Carvalho.

Angolan state oil company, Sociedade Nacional de Combustíveis de Angola (Sonangol) recently announced plans to auction off 54 new onshore and offshore oil blocks in the Kwanza, Congo and Namibe basins, which may drive investment in the sector.

The first auction, due to take place before the end of 2013, is for exploration of 15 onshore oil blocks, 10 in the Kwanza basin and five in the Congo basin.

The inauguration of a liquid natural gas processing unit in June, which will export a potential 7.2 billion cubic metres of gas, the equivalent of 7 percent of annual oil production.

If it achieves its maximum installed capacity, the unit may add two percentage points to Angola’s gross domestic product (GDP) in its first year of operation, according to calculations from the World Bank.

The China National Offshore Oil Corporation (CNOOC) on 18 August received the first of two shipments of LNG from Angola, totalling 155,000 cubic metres, and the first shipment from the unit was sent to Brazil.

Expansion of the oil and gas sector, alongside an increase in private consumption and execution of the public infrastructure investment programme, power production and transport, are the basis of current growth projections for Angola’s GDP in 2013.

These vary between 6.2 percent by the International Monetary fund (IMF), 7.2 percent of the World Bank and 8.2 percent from the Organisation for Economic Cooperation and Development (OECD). (macauhub)

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