Angola: A New Law to Revitalize Aging Oil Production

Angola adopts legislation to revitalize its mature oil fields. The goal: stabilize production above one million barrels per day through fiscal incentives and strategic investments.

Partagez:

Facing a sustained decline in oil production over recent years, Angola is intensifying efforts to maximize the exploitation of its hydrocarbon resources. In November, the government enacted legislation aimed at increasing the viability of mature oil fields, which came into force on December 6.

These fields, representing about 70% of the country’s monetized reserves, are a major focus for the national economy, heavily reliant on oil-generated revenues. The new law introduces fiscal incentives, such as reductions in production taxes and oil income taxes, to attract investors. These measures aim to extend the life of oil fields and stabilize national production, currently around 1.1 million barrels per day, compared to 1.8 million barrels in 2010.

Reduction in Taxes and Strategic Objectives

The Angolan government hopes this reform will encourage oil companies to maintain operations on aging fields despite rising operating costs. Additionally, a licensing cycle for oil and gas exploration is scheduled for the first quarter of next year, aiming to discover new viable reserves.

This initiative is part of a broader policy to maintain stable production, essential for the country’s economic and social stability. Since its withdrawal from the Organization of the Petroleum Exporting Countries (OPEC) nearly a year ago, Angola has ramped up actions to preserve its position in the global hydrocarbons market.

A Concerning Decline

The decline in Angola’s oil production over the past years is attributed to the gradual depletion of historical fields and a lack of investment in new infrastructure. In 2018, the country was still producing 1.3 million barrels per day. This drop has significantly impacted public finances, as oil represents the bulk of Angola’s export revenues.

In response, authorities are adopting a proactive approach, diversifying strategies to revive the oil sector. In addition to fiscal reforms, efforts are underway to improve transparency in the hydrocarbons sector, a key factor for attracting international investors.

Towards a Gradual Recovery

While the measures recently adopted by the Angolan government appear promising, their long-term impact remains uncertain. Oil operators, facing increasing volatility in oil prices and stricter environmental requirements, will need to carefully assess their investments in a market marked by complex geopolitical challenges.

By addressing the challenges of its aging fields, Angola seeks to maintain its place among Africa’s major oil producers. However, this ambition largely depends on the country’s ability to attract investors and diversify partnerships in a rapidly evolving global energy context.

British company Prax Group has filed for insolvency, putting hundreds of jobs at its Lindsey oil site at risk, according to Sky News.
Orlen announces the definitive halt of its Russian oil purchases for the Czech Republic, marking the end of deliveries by Rosneft following the contract expiry, amid evolving logistics and diversification of regional supply sources.
Equinor and Shell launch Adura, a new joint venture consolidating their main offshore assets in the United Kingdom, aiming to secure energy supply with an expected production of over 140,000 barrels of oil equivalent per day.
Equinor announces a new oil discovery estimated at between 9 and 15 mn barrels at the Johan Castberg field in the Barents Sea, strengthening the reserve potential in Norway's northern region.
Sierra Leone relaunches an ambitious offshore exploration campaign, using a 3D seismic survey to evaluate up to 60 potential oil blocks before opening a new licensing round as early as next October.
Faced with recurrent shortages, Zambia is reorganising its fuel supply chain, notably issuing licences for operating new tanker trucks and service stations to enhance national energy security and reduce external dependence.
The closure of the Grangemouth refinery has triggered a record increase in UK oil inventories, highlighting growing dependence on imports and an expanding deficit in domestic refining capacity.
Mexco Energy Corporation reports an annual net profit of $1.71mn, up 27%, driven by increased hydrocarbon production despite persistently weak natural gas prices in the Permian Basin.
S&P Global Ratings lowers Ecopetrol's global rating to BB following Colombia's sovereign downgrade, while Moody’s Investors Service confirms the group's Ba1 rating with a stable outlook.
Shell group publicly clarifies it is neither considering discussions nor approaches for a potential takeover of its British rival BP, putting an end to recent media speculation about a possible merger between the two oil giants.
Petro-Victory Energy Corp. starts drilling of the AND-5 well in the Potiguar Basin, Brazil, as the first phase of an operation financed through its strategic partnership with Azevedo & Travassos Energia.
The Texan Port of Corpus Christi has completed major widening and deepening work designed to accommodate more supertankers, thus strengthening its strategic position in the US market for crude oil and liquefied natural gas exports.
BP Prudhoe Bay Royalty Trust is offering its interest in Prudhoe Bay, North America’s largest oil field, as part of its planned dissolution, assisted by RedOaks Energy Advisors for this strategic asset transaction.
CNOOC Limited’s Hong Kong subsidiary and KazMunayGas have concluded a nine-year exploration and production contract covering nine hundred and fifty-eight square kilometres in Kazakhstan, sharing investment and operations equally.
Donald Trump announced that the United States will no longer oppose Chinese purchases of Iranian oil, immediately triggering a drop in global crude oil prices and profoundly reshaping international energy trade partnerships.
Research firm S&P Global Commodity Insights lifts its outlook for the fourth straight year, betting on three point five mn barrels per day from 2025 despite lower prices.
Enbridge plans to expand its infrastructure to increase oil transportation from the American Midwest to the Gulf Coast, anticipating rising exports and addressing current market logistical constraints.
US commercial crude inventories significantly decline by 3.1 million barrels, widely surpassing initial forecasts and immediately pushing international oil prices higher.
The UK could have hydrocarbon reserves twice as large as current official estimates, according to Offshore Energies UK, highlighting the impact of fiscal policies on forecasts and the economic future of the North Sea.
Following US strikes in Iran, international energy companies partially evacuate their teams from Iraq as a precaution, while Lukoil maintains its entire personnel on southern oilfields.