On the second day of the Angola Oil & Gas 2019 conference, three key agreements were signed between the Ministry of Mineral Resources and Petroleum and various public and private sector parties centering on downstream development, production optimization, gas monetization and renewable energy, and showcasing a diversified, dynamic and revitalized Angolan oil and gas sector.
Memorandum of Understanding
The first agreement signed was a Memorandum of Understanding concerning gas monetization and gas-to-power potential between NFE International, the Ministry of Energy and Water Resources, the Ministry of Mineral Resources and Petroleum and the Ministry of Finance.
NFE has proposed to work on three projects in Angola: the provision of natural gas for Angola power plants; the creation of a natural gas economy for Angola by investing in infrastructure to drill and create a natural gas liquefaction facility; and the supply of gas to the Casing ironworks complex located in the Namibe province. The projects would result in lower fuel costs for Angolan power plants and the establishment of a world-class liquefaction facility in-country, as well as allow for the implementation of an iron ore production and processing plant.
The agreement falls within the framework of the Angolan government’s strategy to increase the percentage that gas contributes to the power matrix. The agreement represents the first step taken by the government toward this objective, as the Ministry of Mineral Resources and Petroleum continues to analyze other initiatives for enhancing the productivity and sustainability of the current power matrix.
The agreement was signed by the Minister of Mineral Resources and Petroleum H.E. Diamantino Pedro Azevedo and the CEO and Chairman of the Board of NFE Wesley Robert Edens.
NFE is an integrated gas-to-power company that employs an integrated liquified natural gas (LNG) production and delivery model using liquefaction, logistics, shipping and downstream terminals.
Commitment Agreement between the ANPG and ExxonMobil
The Commitment Agreement signed between the National Agency of Oil, Gas and Biofuels (ANPG) and ExxonMobil on Block 15 establishes the two parties’ shared commitment to redevelop the block and increase its production by 40,000 barrels of oil per day (bopd). Current production stands at 200,000 bopd, and the agreement aims to optimize production of the acreage.
The agreement was signed by CEO of ANPG, Paulino Jerónimo and Andre Kostelnik, General Manager of ExxonMobil Angola.
ExxonMobil holds a 40 percent interest in Block 15, which contains recoverable resource potential of approximately 4 billion gross oil-equivalent barrels. Since 2003, more than two billion barrels have been produced. Block 15 development is primarily focused on the Kizomba Satellites Phase 2 project, which includes subsea tiebacks to the Kizomba B and Mondo floating production, storage, and offloading (FPSO) vessels.
Officially launched by Presidential decree 49/19 in February, ANPG serves as the national regulator and hydrocarbons concessionaire. The Agency has spearheaded a series of short, medium and long term strategic plans aimed at countering declining oil production, which currently stands at 1.4 million barrels per day, by optimizing existing blocks.
Final Agreement between Sonangol and Eni
Two agreements between Sonangol and Italian multinational oil and gas company Eni were signed by Guido Brusco, Executive VP of Sub-Saharan Africa for Eni and Sebastião Pai Querido Gaspar Martins, CEO of Sonangol.
The first agreement was a Memorandum of Understanding for production of gasoline at the Luanda refinery. Currently producing 300 tons per day, the Luanda Refinery operates at 95 percent of its production capacity and is managed by Sonaref, a subsidiary of Sonangol. In February, Sonangol and Eni signed a partnership agreement that will see the augmentation of gasoline output by four times its current production to 1,200 tons by 2021, which would reduce the current market deficit by 20 percent.
The second agreement centered on the establishment of a joint company for renewable energies. The government of Angola has made significant efforts toward engaging with renewable energies, specifically through strong and diversified investment in the hydroelectric potential of the country.