Long-time Angolan President Jose Eduardo dos Santos has appointed his daughter to lead the oil-rich country's state-run oil giant Sonangol after firing the entire board and replacing all executives.
It's a significant move as Angola surpasses Nigeria as Africa's number one producer, with an official press release noting that the Sonangol purge is "part of a plan to restructure the business so it runs more efficiently".
The 'first daughter', Isabel dos Santos, has been named chairwoman of Sonangol. She is said to be Afrcia's richest woman, worth US$3.3 billion, according to Forbes. Her name is also mentioned in so-called "Panama papers."
Dos Santos, who had been the president of the Angolan Red Cross, caused public outrage late last year when she spent US$2 million to fly US rapper Nicki Minaj to Angola for a brief musical performance.
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Along with the drop in oil prices, Angola's economy has largely become a kleptocracy-a government run by those gunning for status and personal gain at the expense of the nation. Meanwhile, 68 percent of the Angolan population lives below the poverty line.
Angola produces some 1.6 million barrels per day of oil and has been second only to Nigeria among African producers; however, Angola has been ramping up production, while Nigeria's is dropping dramatically due to a resurgence of Niger Delta militancy.
Last month, US company Cobalt announced discovery of condensates and natural gas in the Zalophus # 1 well in Block 20 of the Angolan sea. Cobalt is currently the operator of the block with a 40 percent stake in partnership with Sonangol (30 percent) and BP Exploration Angola (30 percent). In April, Sonangol also discovered huge reserves of oil and natural gas and according to estimates, the exploitation of these new reserves would yield two million barrels of oil daily for three years. Cobalt sold its stake in two blocks to Sonangol last year, but the sale is still being finalized.
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Angola, a member of OPEC, is dependent on oil for 95 percent of its export revenues and is facing an urgent cash flow problem. In April, Moody's downgraded credit ratings of Angola to B1.
Angola has sought financial aid from the International Monetary Fund (IMF) and previously World Bank to weather the crisis engulfing the African nation due to low oil prices, while President dos Santos has gone as far as to dip into the country's sovereign wealth fund just to pay civil servant salaries.
Last June, the World Bank approved a $650-million package of loans for Angola to help it cope with falling oil prices.
By James Burgess of Oilprice.com
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James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also… More
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