Angola has made a major natural gas discovery, marking a breakthrough in the country’s efforts to diversify its fossil fuel production. Azule Energy, a joint venture between BP Plc (NYSE:BP), Eni S.p.A. (NYSE:E) and a group of Angolan companies successfully drilled the country’s first dedicated gas exploration well in the Lower Congo Basin, with preliminary estimates suggesting the reserve holds more than 1 trillion cubic feet of natural gas and up to 100 million barrels of condensates. This is the first natural gas exploration by the former OPEC member, and is expected to enhance the country’s long-term energy security and export potential.
“This is a historic moment for gas exploration in Angola,” Adriano Mongini, CEO of Azule Energy, said in a joint statement. “The success of the Gajajeira-01 well strengthens our confidence in the untapped potential of the Lower Congo Basin,” he added.
The gas discovery is a major lifeline for Angola. The country has set a goal to diversify its revenue streams and lower its reliance on volatile oil markets ever since the country exited OPEC in 2023. Earlier in the year, Angola unveiled its National Gas Master Plan (NGMP), a 30-year strategy aimed at maximizing the country’s natural gas resources. The plan has set a target for the country to attract over $30 billion in investments and generate $150 billion in economic benefits over the next three decades.
Angola has already secured over $60 billion in financial commitments from international financiers over the next five years, an encouraging sign of growing confidence in the country’s energy sector. The Gas Master Plan is the result of the implementation of Law 10/14, which prohibits gas flaring across all the country’s hydrocarbon operations. The NGMP offers a clear blueprint of how to invest in Angola’s gas industry. The central African country harbors ambitions to become a regional gas hub, leveraging its proximity to Asian and European LNG buyers.. It’s estimated that Angola could earn $2–$3 billion in annual LNG revenues by the late 2030s. Angola has also formed the New Gas Consortium (NGC)–its first non-associated gas project that will support domestic energy security.
Angola’s crude oil export revenue in the first quarter of 2025 clocked in at $6.4 billion, an 18% decrease compared to the same period last year, partly due to lower export volumes and partly due to lower oil prices. Angola exported 85.14 million barrels of crude oil during this period, good for a 9.8% year-on-year decline. China remained the top destination for Angolan crude oil exports, followed by India, Indonesia, Spain, and Malaysia. Nigeria and Angola are Africa’s leading oil producers.
Angola has also set a goal to become a leading critical mineral producer, with an objective to produce 17.5 million carats of diamonds annually by 2027 while leveraging the synergies between the hydrocarbon, mining, and agriculture sectors to boost fertilizer production. As such, the Angolan government is implementing policies aimed at supporting multi-sector development.
Meanwhile, last month, the Africa Finance Corporation (AFC) tapped Nigeria and Angola as the leaders in the continent’s ongoing energy transformation. According to the AFC report, Africa could meet up to 90% of its fuel demand if the existing and upcoming refineries operate at full capacity, up from 45% just a year ago. Last year, Nigeria’s beleaguered energy sector witnessed a very significant event: the Dangote Oil Refinery began producing gasoline and selling it domestically to Nigeria’s state oil firm, Nigerian National Petroleum Company (NNPC), marking the first time in decades that Africa’s largest oil producer is refining its own crude. The state-of-the-art $20.5 billion refinery was launched in January 2024, but only began producing gasoline in September. The giant refinery has a capacity to process 650,000 barrels of crude per day, more than enough for the country’s needs. To sweeten the deal further, the facility has been buying crude and selling refined fuels in Nigeria in the local currency, saving the country’s much-needed foreign exchange, especially the U.S. dollar.
Nigeria’s downstream sector has largely been a cesspit of shady deals with little accountability by the NNPC ever since oil was discovered in the West African nation in 1956. For decades, Nigeria has been producing and exporting its crude which is then refined abroad. NNPC swaps Nigeria’s crude oil for refined products, including petrol, which are shipped back home. Incredibly, it only started publishing its accounts five years ago, despite the fact that oil revenue accounts for nearly 90% of Nigeria’s export earnings. In other words, until recently, only the NNPC knew exactly how much money changed hands and who was involved in these “oil swaps”. Hopefully, the Dangote refinery will now change this.
By Alex Kimani for Oilprice.com
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