Energy investments propel an African natural gas revolution in Angola (By NJ Ayuk)
From exploration to production and export, Angola’s oil and natural gas industry is booming
By NJ Ayuk, Executive Chairman of the African Energy Chamber (http://www.EnergyChamber.org).
Africa is witnessing a natural gas movement in Angola that is expected to revolutionize the natural gas industry on the continent. From exploration to production and export, Angola’s oil and natural gas industry is booming. Last year alone, international oil companies and the Angolan government joined forces to award numerous regional operators service contracts worth a combined billions of dollars.
The African Energy Chamber was particularly pleased to see Angola advancing its natural gas industry.
In August 2022, robust plans to develop the Quiluma and Maboqueiro gas fields in the Lower Congo Basin off Angola saw Italian multinational oil services company Saipem secure $900 million between three engineering contracts, procurement and construction for onshore and offshore works associated with the project at three separate sites.
The evolution of these projects is due in part to the creation of the New Gas Consortium (NGC) and its relationship with the Angolan National Agency for Oil, Gas and Biofuels. Investment in the NGC is multinational, with Italian hydrocarbon giant ENI at the helm and French companies TotalEnergies and British Petroleum, as well as Angolan companies Cabinda Gulf Oil Company and Sonangol as shareholders. The NGC projects that production from the Quiluma and Maboqueiro fields will begin in 2026 and reach an estimated rate of 4 billion cubic meters (bcm) of liquefied natural gas (LNG) per year.
The right approach
This success story, which is just one of many in Angola, would not have been possible without the welcoming and investment-friendly environment that Angolan leaders have worked to cultivate in recent years.
Although Angola is the second largest oil producer in sub-Saharan Africa, with an approximate production of 1.1 million barrels per day (bpd) of crude oil, a level similar to that it had before leaving the Organization of the Petroleum Exporting Countries (OPEC), it plans to increase production in the near future, particularly thanks to ExxonMobil’s deepwater Block 15 discovery in the Kizomba B area. the bloc, Azule Energy, Equinor and Sonangol, did not hesitate to invest in this project.
Angola is rejecting complacency and working to increase these figures by launching new wells while reassessing its more mature installations. Angola’s approach and commitment to continued progress should serve as a model for all other African countries.
Angola sits on 27 trillion cubic feet of natural gas – a largely untapped wealth that represents a path to vast job opportunities, a path away from energy poverty, and a bridge to an eventual energy transition. One of the key elements in ensuring that this economic development moves in favor of Angola and Africa is a competent administration to help guide it.
Political will and leadership are essential
Since taking office in 2017, President João Lourenço has maintained a positive focus on strengthening and improving Angola’s oil and gas sector and focused on enriching its population.
Employing a rational, long-term mindset in the effort to expand Angola’s LNG exports and develop its gas industry, President Lourenço has managed a multi-faceted master plan that he hopes, will place Angola in an exponentially more prosperous position over a 30-year period.
Mr. Lourenço’s actions in this regard have been proactive and comprehensive and have helped support a healthy domestic oil and gas industry. By working to improve Angola’s business environment and eradicating internal corruption, Mr. Lourenço has made the country much more attractive and favorable to foreign investment. The reappointment of Diamantino Pedro Azevedo as minister of mineral resources – a key player in Angola’s regulatory overhaul and a staunch defender of Africa’s energy industry – demonstrates Mr. Lourenço’s commitment to preserving a cabinet that produces significant results.
President Lourenço’s prospects go far beyond the successful export of Angola’s hydrocarbon resources. His plan calls for expanding the country’s refining and storage facilities as well as preparing for the transition to a low-carbon economy through the establishment of photovoltaic power plants, green hydrogen production and commitment to increase Angola’s energy consumption from clean sources such as hydropower.
Mr. Lourenço is convinced that his country will be able to achieve these goals in part through the establishment of productive international relations, a practice which he believes will also guarantee future commercial partnerships.
A ready-made market
President Lourenço’s meeting with US President Joe Biden at the White House in 2023 served to declare Angola a strategic partner and announce a multi-billion US investment in a system that will provide photovoltaic energy to four provinces in southern Angola.
The widespread difficulties linked to the war in Ukraine have placed Europe in a precarious situation with regard to its natural gas supplies, most of which came from Russia until the start of the conflict. President Lourenço is convinced that Angola can offer Europe an alternative Source of LNG thanks to European investments in the country and cooperative relations between the two regions.
Angola could gain a larger position in the global LNG market sooner than expected, even without immediate support from Europe. Mr. Lourenço foresees an economic boom on the horizon that will put Angola’s LNG production and export on the fast track in the years to come.
System-wide improvements
In addition to the developments of the Quiluma and Maboqueiro fields, other Angolan natural gas projects are on track.
The Angola LNG project, a joint venture led by Chevron and Sonangol north of Luanda in Soyo province, processes and monetizes 1.1 billion cubic feet of natural gas per day while reducing gas flaring and gas emissions at greenhouse effect.
Sonangol also worked hard in Cabinda, modernizing, automating and subsequently tripling its plant’s gas filling capacities from 3,000 12-kilogram gas cylinders per day to 9,000 cylinders per day, which is expected increase gas availability in the region by 28%.
By next year, Angola expects the Soyo II combined cycle power plant, with a capacity of 750 MW, to be operational, contributing to a national effort to expand the population’s access to electricity by almost 20% thanks to the production of electricity from gas.
The Falcão natural gas project promises to diversify the country’s participation in the natural gas industry by providing a means to produce fertilizer, reducing reliance on imports while reducing overall agricultural costs.
These developments, coupled with assurances given by Minister Diamantino Azevedo during the 2022 Angola International Oil and Gas Conference that Angola will soon have floating liquid natural gas platforms off its coast, paint a picture positive of Angola’s energy future.
The African Energy Chamber welcomes the progress made by Angola in the LNG sector. Natural gas is a clean and convenient energy Source that has the power to eradicate energy poverty and boost local economies across the continent, while paving the way for a just energy transition. We encourage all African nations to join Angola on the path it is charting.
Distributed by APO Group for African Energy Chamber.
Source
African Energy Chamber
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