Angola’s Fiscal Reforms Spark Offshore Oil and Gas Exploration Revival

Angola’s oil and gas sector is experiencing a resurgence, driven by fiscal reforms introduced since President João Lourenço assumed office in 2017. Industry experts and operators have lauded the changes, making engagement with the Angolan government smoother and the regulatory framework more attractive to investors. These developments have sparked renewed interest in Angola’s offshore exploration, reversing a decline that followed the 2014 global oil price crash.

Clementine Wallop, Director for Sub-Saharan Africa at Horizon Engage, highlighted the positive feedback from industry players. “We hear so much positive feedback on Angola, chiefly around the ease of engagement with government and the simplicity of government structures, in addition to the attractive fiscal frameworks,” Wallop noted.

Angola’s Road to Revival

The country’s deepwater exploration success peaked in 2011 with the award of 11 pre-salt blocks. However, the crash in oil prices three years later led to widespread relinquishment of exploration licenses between 2015 and 2019. Angola’s oil sector began recovering after introducing new tax incentives, encouraging supermajors to re-enter the market.

Jimmy Boulter, Regional Manager at Enverus, reflected on Angola’s efforts, saying, “The results of the work put in to reform the fiscal environment for its crucial oil and gas sector since President Lourenço took power in 2017 could be visualised in many ways. Incentivization of infrastructure-led exploration, marginal field developments, and non-associated gas projects are among the obvious wins.”

In 2024, ExxonMobil demonstrated renewed interest by drilling the Arcturus 1 well in the Namibe Basin. Though the well did not yield commercial discoveries, the activity symbolized the reawakening of high-risk frontier exploration in Angola.

New Licensing and Exploration Activity

Major oil companies are gearing up for further exploration in Angola’s deepwater basins. In November 2024, Shell signed a Memorandum of Understanding to explore six key blocks in the Lower Congo Basin, marking its re-entry into the Angolan market. Meanwhile, Azule Energy, a BP-ENI joint venture, has taken on Blocks 46 and 47, with plans to drill the Kianda 1 well in 2025. Chevron has also secured Blocks 49 and 50, prompting the start of new 3D seismic surveys by geophysical services company TGS.

The Angolan government had initially planned to launch the 2025 Limited Public Tender for nine offshore blocks in the Kwanza and Benguela basins in early 2025. However, with four of these blocks now under preliminary evaluation by major operators, there may be delays or adjustments in the licensing schedule.

Prospects for Angola’s Energy Sector

The combination of fiscal stability and government engagement has re-established Angola as a competitive destination for oil and gas investment in Sub-Saharan Africa. With supermajors returning and new deepwater exploration projects on the horizon, Angola is positioning itself to capitalize on its vast hydrocarbon potential.

These developments reflect Angola’s determination to sustain and expand its offshore oil production, ensuring that the country remains a key player in the global energy market.

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