One of Africa’s biggest oil producers, Angola, will sign next week an exclusive agreement with Shell under which the supermajor will explore and potentially develop several offshore blocks, Angola’s oil and gas agency ANPG has said.
“This event marks a historic moment for the Angolan oil sector, consolidating Shell’s presence in Angola, an ANPG statement said, as carried by Reuters.
Under the agreement Shell will explore Blocks 19, 34, and 35 and several ultra-deepwater blocks as Angola looks to revive its exploration and production sector following years of underinvestment and supply restrictions under the deals within OPEC, which the country quit effective January 2024.
Earlier this year, Angola’s crude output slipped below 1 million barrels per day (bpd) for the first time in two and a half years and for the first time since one of Africa’s biggest oil producers quit OPEC.
Angola’s motivation to exit the cartel after 16 years was a spat with the OPEC and OPEC+ members about production quotas. At a meeting in mid-2023, Angola and Nigeria were given lower crude oil production quotas as part of the OPEC+ agreement, after the two producers had underperformed and failed to pump to their quotas for years, due to a lack of investment in new fields and maturing older oilfields.
Angola now aims to revitalize its oil and gas industry and itis betting big on natural gas developments to monetize more of its fossil fuel resources.
Shell, for its part, is looking to boost exploration efforts, including in Africa, where it has made a discovery offshore Namibia, to Angola’s south.
“We went through a significant reset, I would say, of our exploration department, capability, the funnel, because the hard truth is while we have had some good progress in certain areas, it hasn’t delivered what we had wanted,” Shell’s chief executive, Wael Sawan, told analysts on the Q2 earnings call at the end of July.
Shell will continue to invest in exploration where it has established track records, like the Gulf of Mexico, Malaysia, Oman, and in areas like Namibia, added Sawan, who has said that reducing global oil and gas production would be “dangerous and irresponsible”.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com
- India’s Top Refiner Buys Non-Sanctioned Russian Crude
- TotalEnergies LNG Project in Mozambique Hits New Financial Snag
- Japanese Utilities Confident in Replacing Russian LNG
