OTC: Angola prequalifies 40 companies for licensing round

Angola has prequalified 40 oil companies under its latest licensing round, which lists 10 blocks as available, Syanga Abilio, vice-president of Sonangol, told OGJ on May 6 at OTC in Houston.

Uchenna Izundu
International Editor

HOUSTON, May 7 -- Angola has prequalified 40 oil companies under its latest licensing round, which lists 10 blocks as available, Syanga Abilio, vice-president of Sonangol, told OGJ in an exclusive interview May 6 at the Offshore Technology Conference in Houston.

The successful candidates include majors Royal Dutch Shell PLC and ExxonMobil Corp., independent oil companies, and private Angolan firms. As so many Angolan companies have applied for licensing permits, the government needs more time to evaluate them, Abilio said. So the country has postponed the Mar. 13 deadline by which companies had to submit proposals for blocks. "A new deadline has not yet been given, but we plan to announce that shortly," Abilio said.

About 200 companies participated in the licensing round, which offers both deepwater and ultradeepwater blocks. "We don't know what kind of interest the prequalified companies had in the blocks as they had not yet given us a plan for the ones that they wanted," Abilio said.

The government invited companies to bid for onshore blocks Cabinda Centro in the Cabinda Centra basin and KON11 and KON12 in the Kwanza basin. In shallow water, Block 9 was offered. Three blocks, 19, 20, and 21, were in deep water, and Blocks 46, 47, and 48 were in ultradeep water.

Angola's recent admission into the Organization of Petroleum Exporting Countries should not dissuade potential investors from coming to the country, Abilio said. "We joined the institution that works to protect price and it was important to be part of that; we were an observer at OPEC for a long time. We have a quota of 1.9 million b/d but that does not bind us on further exploration and production. We had our oil infrastructure destroyed during our civil war and there is nothing to fear with future investment."

Sonangol aims to become a fully integrated company across the petroleum value chain by 2010. It has bought a 20% stake in Societe Ivoirienne de Raffinage's 64,000 b/d refinery at Vridi, Abidjan, in Ivory Coast. Abilio declined to give the value of the investment.

"We are also building a new refinery in Lobito, Angola, which will cost about $7 billion," he said, adding, "It will have a 200,000 b/d capacity and we may seek technical partners in the future. For now, we are doing the project by ourselves."

Sonangol had originally planned to develop the refinery with China's Sinopec but talks broke down last year following disagreement on what products the refinery would make. It will process heavy acidic oil (such as Kuito and Dalia) and will have a high conversion with crude, vacuum, fluid cracking, and delayed coking units. Construction of the refinery will start by yearend and operations in 2010.

Contact Uchenna Izundu at uchennai@pennwell.com.

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