Representing 70%, or $15 billion of oil- and gas-related mergers and acquisitions (M&A) in Africa in 2022, Angola has significantly expanded its role in shaping the continent’s M&A activities according to a new study released by Rystad Energy.
With majors diversifying portfolios, 2022 M&A deals are expected to bring in a new era of oil and gas investments in Angola in 2023 and beyond as local and regional companies maximize resource and infrastructure exploitation to generate revenue, according to the study.
The formation of Azule Energy by bp and Eni
The $14-billion integration of the respective Angolan assets of bp and Eni has not only formed the country’s largest independent oil and gas producer, but represents the country’s largest oil and gas merger and acquisition deal.
In terms of its contributions to national production, while natural declines in legacy projects have threatened Angola’s total crude output, the Eni-bp deal is expected to increase the country’s production from 2023, with Azule Energy targeting oil and gas production of 250,000 barrels equivalent per day over the next five years. The merger is paving the way for accelerated development of large-scale projects previously led by both companies, such as the Agogo Full Field and PAJ oil projects in Blocks 15/06, and 31 respectively.
Somoil, Sirius Petroleum acquire Sonangol assets
This $336-million deal saw a joint venture between Somoil and Sirius Petroleum acquiring participating interests of 8.28% and 10%, respectively, in Blocks 18 and 31, which are producing assets. The joint venture also acquired a 25% participating interest in exploration in Block 27. With Somoil and Sirius Petroleum aiming to take advantage of high oil prices and increasing energy demand across the globe, the acquisition is expected to play a crucial role in expanding production in Angola in 2023 and beyond.
NAMCOR, Sequa Petroleum and Petrolog acquire Sonangol assets
In a $350-million deal, Namibia’s national oil company NAMCOR, the U.K.’s Sequa Petroleum and Angola’s Petrolog became Sonangol’s exploration, production and monetization partners in Blocks 15/06, 23 and 27. According to Rystad Energy, quick redevelopments of the oil assets are expected starting next year, as the partners seek to tap into existing reserves and reap the benefit of strong barrel prices.
Afentra acquires INA and Sonangol assets
In two separate deals, London-listed oil and gas independent Afentra ranks among the top buyers of oil and gas assets in Angola in 2022. In an $80.5-million deal, the firm acquired stakes from Sonangol in offshore Block 3/05 and Block 23. With the assets requiring low-CAPEX to boost production, Afentra is expected to leverage the deal to maximize its output in the coming years, as a newcomer to the Angolan market. From INA, Afentra acquired stakes in exploration and producing Blocks 3/05 and 3/05A in a $12-million deal.
Somoil acquires assets from TotalEnergies and Inpex
Somoil, which serves as Angola’s largest private oil company, acquired interests in oil-producing Blocks 14 and 14K this year, which the company hopes to revive in order to boost national output. The blocks have been in operation since 1999 and produced 9,000 barrels of oil equivalent per day in 2021, yet hold significant hydrocarbon reserves that remain to be unlocked.