Nigeria Overlooked as Investors Flock to Angola with $50bn Investments.
Nigeria’s once unchallenged dominance in Africa’s oil production is slipping as Angola becomes the new favorite for international oil companies. Investment in Angola’s oil sector surged by 96% from 2022 to 2023, with nearly $50 billion invested over the past five years, according to Angola’s National Oil, Gas and Biofuels Agency (ANPG).
Angola plans to attract around $71 billion in oil investments over the next five years, excluding incremental production. Since 2017, Angola has implemented significant industry reforms, creating a transparent and competitive oil market. A six-year licensing round, introduced in 2019, guarantees yearly investment opportunities, with the latest round drawing 53 bids for blocks in the Lower Congo and Kwanza Basins.
José Barroso, Angola’s secretary of state for oil and gas, highlighted regulatory flexibility and various incentives, including production-sharing agreements and a risk-reducing alternative introduced in 2020. A permanent offer program started in 2021 allows for new contract negotiations without bid rounds. A Tax Benefits Code enacted in 2022 further incentivizes oil companies.
Barroso emphasized the government’s openness to balanced agreements, license renewals, and maintaining strong relationships with oil companies. With oil contributing over 30% of GDP, 70% of government revenue, and 90% of exports, Angola’s strategy aims to prioritize oil and gas production for the next decade.
In contrast, Nigeria, with vast oil reserves of 37.1 billion barrels, faces bureaucratic challenges, contracting delays, and low local participation. Inconsistent policy-making has driven investors away, as highlighted by TotalEnergies CEO Patrick Pouyanne. Nigeria’s ongoing debates over new petroleum laws create uncertainty, prompting TotalEnergies to divert a $6 billion project to Angola, which offers a more stable policy environment.
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