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The government of Angola has announced it will privatise 30 per cent of the national oil company, Sonangol, by 2022 as part of ongoing reforms in the Southern African nation's oil and gas sector. According to a statement released on Tuesday, the government believes that the reform will enable the company to raise money for investment, and also increase its competitive edge.

Speaking in London last month, Angola’s Minister of Mineral Resources and Petroleum, Diamantino Pedro Azevedo, said the government had made significant progress in its efforts to restructure the oil and gas sector. He said part of the government’s initial successes include significant cost reductions at Sonangol. This has informed the government’s decision to sell up to 30 per cent of the company’s stake.  

The privatisation process would entail selling off Sonangol’s subsidiaries that do not belong to the company’s core business of exploration and production. It would offer significant opportunities for new entrants into Angola’s oil and gas sector. According to initial projections, Sonangol’s privatisation would attract foreign direct investment (FDI) flows of up to $10 billion in the next three years into Africa's second largest oil producing-nation, after Nigeria.

As part of the government’s strategies to reform the sector and promote investment, Angola’s Ministry of Mineral Resources and Petroleum has partnered with Africa Oil & Power, a premier platform for energy investment and policy on the continent, to organise the upcoming Angola Oil & Gas (AOG) Conference & Exhibition 2020. The conference, which will be held for a second year to drive new deals into Angola’s oil and gas sector, will take place on June 16-17 in Talatona.

“Thanks to the President’s sweeping reforms, Angola has embarked on an ambitious drive to attract foreign direct investment,” said James Chester, Acting CEO of Africa Oil & Power. “Africa Oil & Power is proud to support those ongoing efforts with a global promotional campaign. The AOG Conference & Exhibition, which has become an unmissable, unrivaled investment event, will provide a strong anchor point for the 2020 initiative.”

An Organization of the Petroleum Exporting Countries (OPEC) member, the partial privatation of Angola's national oil company will follow similar efforts by Saudi Arabia's Aramco, which launched its Initial Public Offering (IPO) in December 2019. Considered the world's largest IPO, Saudi Aramco sold 1.725 per cent of its stake and raised $29.4 billion. The restructuring of Saudi’s national oil company is aimed at raising funds to drive the country’s Vision 2030 economic reform plan, which was introduced in 2016.

According to a statement by Africa Oil & Power, the AOG 2020 event will focus on promoting bankable projects, including the 2020 oil and gas licensing round, marginal field development, gas monetization, and projects across the value chain, including the international tender for the Soyo refinery and the ramp-up of the Cabinda and Lobito refineries.

In November, Angola formed a consortium with five international oil companies, including Eni and Chevron to develop liquefied natural gas (LNG) for its Soyo plant. According to  Reuters, the $2 billion Soyo LNG plant is designed to process 1.1 billion cubic feet of natural gas per day and has the capacity to produce 5.2 million tonnes of LNG per year, as well as natural gas, propane, butane and condensate.