"Natural Gas Could be Angola\u2019s Next Big Money Maker"

" Natural Gas Could be Angola\u2019s Next Big Money Maker \r\nAngola is betting big on\u00a0 natural gas \u00a0developments as a short-term increase in oil production is not expected to last despite the West African country leaving OPEC over capped production.\r\n\r\nCompanies operating in Angola have recently started up two oil projects, but they have also begun to target non-associated offshore gas plays, hoping that a massive gas resource could be waiting to be tapped.\r\n\r\nDespite the recent oil project startups, Angola\u2019s oil production is expected to drop to about 1 million barrels per day (bpd) in 2027, from over 1.1 million bpd now, officials at the national oil and gas agency ANPG have told\u00a0 Reuters .\r\n\r\nAt the same time, natural gas output is set to jump by 2030, per ANPG estimates.\r\n\r\nIncreased gas output will raise Angola\u2019s LNG exports as developers offshore Africa bet big on natural gas to export to Europe and Asia.\r\n\r\nA recent large gas discovery year could be one of many gas plays that could underpin a jump in LNG exports and state revenues from gas.\r\n\r\nLast month, Azule Energy, a joint venture of international majors BP and Eni,\u00a0 discovered \u00a0a major natural gas reservoir offshore Angola in the first gas-targeting exploration well in the oil-producing country.\r\n\r\nInitial assessments suggest gas volumes in place could exceed 1 trillion cubic feet, with up to 100 million barrels of associated condensate, Azule Energy said, adding that these results \u201cconfirm the presence of a working hydrocarbon system and open new exploration opportunities in the area.\u201d\r\n\r\nAzule Energy CEO, Adriano Mongini, commented:\r\n\r\n\u201cThis is a landmark moment for gas exploration in Angola. Gajajeira-01 is the country\u2019s first dedicated gas exploration well, and its success reinforces our confidence in the potential of the Lower Congo Basin.\u201d\r\n\r\nMore recently, Mongini told Reuters that \u201cGiven that Angola has a couple of prolific basins, I can imagine that we will be able to find much more reserves of gas.\u201d\r\n\r\nBP\u2019s EVP production & operations, Gordon Birrell, highlighted the Angola discovery and its potential on the\u00a0 Q2 earnings call .\r\n\r\n\u201cUnder the Azule brand, we had a discovery in Gajajeira in block 1\/14, pretty close to shore, very developable. So West Africa remains an exciting area for us in terms of exploration,\u201d Birrell told analysts.\r\n\r\nThe exciting gas discovery comes as Angola struggles to materially boost oil production even after\u00a0 exiting OPEC \u00a0in January 2024, following a spat with the OPEC and OPEC+ members about production quotas.\r\n\r\nAngola\u2019s oil production peaked in 2008 at about 2 million bpd. Output has declined in recent years, due to underinvestment in offshore resources due to higher development costs, which have prompted many companies to overlook the African oil producer as an investment destination.\r\n\r\nAzule Energy and TotalEnergies started up new oil projects last month, but these may not be enough to offset a decline in maturing fields.\r\n\r\nAzule Energy announced at the end of July\u00a0 the successful startup \u00a0and first oil production from the Agogo FPSO. Combined, the Agogo and the Ndungu fields have estimated reserves of about 450 million barrels, with projected peak production of 175,000 barrels per day, produced via two FPSOs (Agogo and Ngoma).\r\n\r\nAlso at the end of July, TotalEnergies\u00a0 launched oil production \u00a0from the BEGONIA and CLOV Phase 3 offshore projects via subsea tiebacks to FPSOs to add a total of 60,000 barrels a day of new production.\r\n\r\nStill, Angola\u2019s oil revenues have dropped this year due to falling oil prices. Revenues from oil declined by 4% from the first quarter to $5.6 billion in the second quarter, according to\u00a0 government data . LNG and gas exports meanwhile, earned $755 million in the second quarter.\r\n\r\nNow the BP-Eni Azule venture is\u00a0 close to launching first gas from the New Gas Consortium (NGC) project after completing early this year the Quiluma and Maboqueiro offshore platforms in a \u201csignificant step forward in Angola\u2019s first non-associated gas development.\u201d\r\n\r\nThe NGC project is a joint venture between Azule Energy, Sonangol E&P, Chevron, and TotalEnergies.\r\n\r\n\u201cDevelopment of (NGC's) Quiluma and Maboqueiro fields, due to launch around end-2025, is the real litmus test for gas monetisation in Angola,\u201d Jimmy Boulter, an analyst at Enverus, told Reuters."

"Natural Gas Could be Angola\u2019s Next Big Money Maker"

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Natural Gas Could be Angola’s Next Big Money MakerAMP

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