Combatting decreasing oil production
Angola produced 1.3 million barrels of oil per day in 2020, the lowest level in the last decade. For comparison, in 2010, production reached a peak of around 1.8 million barrels daily. Though the African country still hast vast oil reserves, there is a lack of private and public investment. To change this scenario, the Angolan government released a strategic plan for the exploration of hydrocarbons during 2020-2025, which includes bidding on 50 oil blocks, and investments reaching 800 million U.S. dollars. Moreover, the Angolan parliament has recently approved new tax incentives to boost the oil industry in the country.Plans for the downstream sector
Besides the stimulus to increase exploration and production of crude oil and natural gas, Angola also developed a strategy to support the domestic oil refining sector. After all, despite the vast production of oil, the country constantly struggles to supply the national demand for refined products. In 2020, around two million metric tons of refined petroleum products were imported to fuel the local consumers. The supply issue is due to the fact that Angola has only one active refinery in Luanda, with the capacity to produce 65 thousand barrels of refined oil per day. Additionally, 15 thousand barrels of fuel are generated in the Malongo-Cabinda area. To change this situation, several new refineries are planned, and Angola expects to increase the oil refining capacity to 425 thousand barrels per day in 2025.State oil firm on the way to privatization
Among further efforts to revitalize the oil sector, Angola plans to attract more foreign investment. In the first quarter of 2021, inflows of foreign direct investment in the petroleum industry amounted to 1.6 billion U.S. dollars. Currently, major international oil companies dominate the sector, with a market share of over 90 percent in the production of crude oil. The state oil firm Sonangol holds a roughly two percent share of the crude oil market.
