Angola Opens Oil Distribution Sector

sonangol
Sonangol

The Ministry of Mineral Resources and Petroleum announced the complete liberalization of the commercialization and distribution of hydrocarbon derivatives as part of the restructuring plan currently underway in Angola.

The measure is aided by the creation of the Petroleum Derivatives Regulatory Institute and the sector reorganization model, to be completed by late 2020, which aims to withdraw the concession rights of the National Fuel Society of Angola (SONANGOL) in favor of the still-created National Oil and Gas Agency.

SONANGOL, who has already managed to reduce its debt from 9,000 to around 3,000 million dollars, will be dedicated only – once the Agency is created – to the research, exploitation, production, refining and distribution of fuels.

The transfer of SONANGOL’s auditing functions to the Agency will take place in three phases, the first already underway with the support of an installation commission to establish the legal, technical and material conditions for the start of the Agency.

A few days ago, SONANGOL’s president, Carlos Saturnino, assured that the definitive transfer will be done when the National Oil and Gas Agency -created this year by decree- is fully operational.

The Gross Income of Sonangol increased until last September to 28,906 million dollars, more than double the total of 2016 when the economic and financial crisis in Angola since late 2014 was at its peak.

During this year crude barrel prices reached 80 dollars (currently below 70), allowing to surpass the 2016 income of 14,949 billion dollars, exceeded last year with U.S. 17,488 billion.

However, in the period the pumping of crude decreased from 1.722 in 2016, to 1.632 in 2017 and an average of 1.4 during the current cycle.

The bankruptcy was due to declining production in various fields and operational problems arising from lack of investment.

During the parliamentary preparation days for the discussion of the general state budget in 2019, which sets for income and expenditure purposes a value of 68 dollars for the exported oil barrel, General Tax Administration technician Patricio Quingongo said that only 37 percent of the income from oil sales goes to the state.

The country’s production of 1.4 million barrels raises some 96 million dollars a day, out of which it gets only 37 percent.