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OPEC producer Angola is putting the finishing touches on its first oil licensing round in eight years, hoping to replace dwindling production at some maturing fields and seeing renewed investor appetite in its oil industry, Angola’s Minister of Mineral Resources and Petroleum Diamantino Pedro Azevedo told S&P Global Platts in an interview published on Friday.
Angola is preparing a strategy for onshore and offshore oil and gas blocks licensing for the period 2019 through 2025, Azevedo said.
After the oil price crash of 2014, Angola’s economy had suffered from the low oil prices and the country had also been struggling to attract international investments in its deepwater higher-breakeven oil resources.
Last year, Angola introduced several new measures to try to boost its oil production and its attractiveness for international investment. President Joao Lourenco signed in the summer of 2018 a decree to create an agency that would sell and manage oil blocks instead of state oil firm Sonangol. The National Agency of Petroleum and Gas is expected to launch in 2019 and be fully operational by the end of 2020.
Earlier in 2018, Angola halved the tax rates on the development of oil discoveries with fewer than 300 million barrels of reserves. Angola cut the petroleum production tax on so-called marginal fields—those with less than 300 million barrels of reserves—to 10 percent from the typical 20 percent tax. The tax reforms also halved the petroleum income tax on marginal fields to 25 percent from 50 percent.
Angola’s upcoming licensing round comes as interest in the country’s oil sector has increased and as a new major start-up—the biggest deep offshore development in Angola, Kaombo, came on stream, contributing 115,000 bpd to Angola’s oil production. The second phase of the project led by France’s Total will add another 115,000 bpd of production and is expected to start up this year.
Angola, however, is sticking to its pledge in the OPEC/non-OPEC deal to hold its oil production at 1.481 million bpd between January and June, its petroleum minister Azevedo told S&P Global Platts.
According to the latest OPEC figures, Angola’s oil production was 1.521 million bpd in November, basically flat compared to October. OPEC will report the December production levels of its members next week.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.