Angola’s thriving oil industry recently received a strong endorsement from Afentra’s CEO, Paul McDade, following the company’s brisk move into the nation’s market. McDade expressed confidence in Angola’s oil industry infrastructure and highlighted the country’s proactive support for businesses investing in their oil and gas sector.
Having swiftly secured a material position in both Block 3/05 and Block 3/05A, Afentra underscores its commitment to the African nation. This move followed Afentra’s inaugural foray into Angola in May, with the acquisition of a stake from INA. Furthermore, the company anticipates the conclusion of two more significant deals by the end of the year.
Amid the ongoing negotiations and transitions, McDade revealed that the blocks have already commenced production. This has led to a surplus cash inflow, which will consequently reduce the sum Afentra will owe upon deal completion. The CEO estimates the completion payment to hover around $50 million, with the stake in the blocks potentially generating an equivalent amount annually. This substantial revenue is projected to be partly reinvested by the company.
Shareholders will soon weigh in on the ongoing developments, with a decisive vote set for October 5. Should they favor the proposals, the next steps would involve securing the ministry’s approval to finalize the sale, followed by the novation process.
McDade’s optimism regarding the year’s end stems from Afentra’s prior dealings, specifically the INA transaction. He believes the experience garnered will ensure more efficiency this time. Once Afentra assumes control over the assets, McDade foresees the company ending the year on a high note, emphasizing both “value and cash flow”.
Highlighting the benefits of their current investments, McDade shared that Afentra has already recorded a sale of its first 300,000-barrel cargo from the stake, translating to an impressive $26mn revenue.
The commendable fiscal terms on the blocks will certainly benefit Block 3/05 and 3/05A partners, though specifics remain undisclosed. McDade did, however, accentuate the Angolan government’s keen focus on the oil and gas industry, noting their commitment to creating a stable environment that’s attractive to investors.
Furthermore, the Angolan government’s strategic support has manifested in the extension of the Afentra group’s license. Such a move, McDade says, provides a long “runway to invest” and reinforces West Africa as a promising region for business ventures. Key players like the Agência Nacional de Petróleo, Gás e Biocombustíveis (ANPG) have actively facilitated this environment, ensuring open dialogue and fostering progressive discussions.
McDade’s praise for Angola’s investment environment resonated throughout the conversation. He highlighted the nation’s ambitious goal to maximize oil production while simultaneously mitigating its carbon footprint.
As Afentra contemplates its future after the anticipated Sonangol and Azule deals, the prospects look promising. McDade hinted at further growth opportunities, especially in Block 3/05A, which boasts an estimated 300 million barrels.
The firm’s ambitions don’t end there. With a solid financial foundation, Afentra envisions funding subsequent deals without any external cash infusion, setting the stage for more substantial growth in Angola’s vibrant oil industry.
