Angola Takes Over Downstream Development

As the second largest oil producer in sub-Saharan Africa, with recent production levels estimated at 1.22 million barrels per day (bpd), the Republic of Angola continues to make progress in the upstream segment of its hydrocarbon sector. However, recently the southern African country’s downstream sector has been gaining faster momentum, with many large-scale projects underway. By prioritizing these downstream mega-projects, the Angolan government aims to increase domestic capacity, reduce imports of refined oil and begin to firmly establish the country as a safe and energy-independent hydrocarbon market. The Angola Oil & Gas Conference, hosted by Energy Capital & Power ( and running from November 29 and 30 to December 1, investigated this topic, with a panel discussion centered on the need to expand Angola’s downstream sector.

Strengthening Angola’s Refining Capacity

Currently, 80% of the country’s refined petroleum products are imported, costing Angola $1.7 billion a year to meet domestic demand. With this reality in sharp focus, the government accelerating its energy security and self-sufficiency ambitions, and with its own 8.2 billion barrels of oil reserves, there are strong reasons for upgrading current facilities and for the construction of new refineries across the country. .

Angola’s only operating refinery, the Luanda refinery, currently meets only 20% of domestic demand, producing around 60,000 barrels per day. However, the government is aiming to expand this capacity, with a $235 million project, which will bring production to 72,000 barrels per day. According to HE Diamantino de Azevedo, Minister of Mineral Resources, Oil and Gas, this project alone will save the southern African country about $200 million in import costs. Moreover, the Ministry through the national oil company Sonangol is developing three new refineries located in Cabinda, Soyo and Lobito. Two of the refineries, Cabinda and Soyo, are being developed by US-based Quanten Consortium Angola, with production estimated at 60,000 bpd and 100,000 bpd, respectively.

In addition, the public tender process for the third and largest refinery—the 200,000-bpd Lobito refinery—was launched in October 2021.

Overall, the Angolan government targets production of 360,000 barrels per day locally, prioritizing meeting domestic demand while encouraging socioeconomic growth and industrialization.

Improving Downstream Gas Industry

Meanwhile, with Angola prioritizing natural gas expansion backed by more than 13.5 trillion cubic feet (tcf) of reserves – the eighth largest in Africa – the government is also focusing on increasing the production, refining and distribution of gas products, particularly Liquefied Natural Gas. (LNG).

Currently, the Angola LNG Plant is actively producing LNG, has been operating since 2013. Co-owned by Cabinda Gulf Oil Company (Chevron) with 36.4% shares; Sonangol with 22.8%; bp with 13.6%; Eni Italia with 13.6% and TotalEnergies with 13.6%, the project offers a production capacity of 5.2 million tons per year. In addition, the plant consists of a single facility capable of producing LNG, propane and butane, supplied by a network of pipelines from offshore fields. As gas-related exploration and production increases across the country, new projects are also expected to gain momentum in the next few years.

Starting a Regional Infrastructure Project

Lastly, to strengthen Angola’s downstream infrastructure, particularly with regard to efficient oil and gas transportation, the government ensures investment in related infrastructure programs, such as pipelines. In this regard, the Angolan government signed a $5 billion deal with the Zambian government in 2021, for the construction of an oil pipeline that would link the two southern African countries. The pipeline will allow Angola to supply Zambia with finished oil products, strengthening regional oil trade.

Meanwhile, in line with the 2018-2022 National Development Plan, the government has a strategic intention to improve port infrastructure along with the target of strengthening oil and gas trade regionally and throughout the African continent. Thus, developments such as the proposed sixth international port, Barra do Dande Port, located 50 km north of the capital, are set to boost Angola’s downstream industry. The $1.5 billion deep-sea port will consist of 29 storage tanks, a terminal for solid and liquid bulk materials, a container terminal, a multi-use terminal and a petroleum support zone. What’s more, global supply chain company DP World will invest $190 million to transform the Port of Luanda into a regional maritime hub, thereby overall increasing Angola’s downstream capacity, while strengthening regional hydrocarbon trade.

Distributed by the APO Group on behalf of Energy Capital & Power.

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Angola Takes Over Downstream Development

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