A game changer for Angola’s oil and gas sectorApril 7, 2022
Emanuel Borges, general manager of Quimicoil, talks to The Energy Year about the importance of developing local chemicals manufacturing capacity in Angola, as well as the company’s scope of production and plans for expansion. Quimicoil blends and sells cleaning products for the oil and gas sector and the food industry.
What is the importance of Angola developing manufacturing capacity for chemicals?
If we have chemical and mechanical engineers here, we can mix and produce products and offer real solutions to companies. We think this is going to be a game changer in the industry.
We detect that in this industry no one has produced in this area due to a lack of know-how. It is a very specific area and without immediate financial gains. It is necessary to sow in order to harvest. The reason there is a vacuum of chemicals made in Angola is that the players have become accustomed only to selling and not to producing. Everyone has been thinking only of making a great profit, and fast. The mentality of entrepreneurs has been to have a company abroad and sell to Angola.
In addition, we have opened a services department with technicians specialised in the application of our products, increasingly cultivating learning experiences with our partners and customers, developing integrated solutions.
The government has given strong signals that producing locally is the future. We hear the message, and we want to develop industry in Angola and be a company that increasingly brings added value to all Angolans.
We have partnerships with local universities, and have started to offer internships to students. We are looking for the next great Angolan specialists to be by our side in the next few years. We have to give opportunities to this generation. We are training local staff, and we only have two expatriates among our 42 employees.
Angola remains a fantastic land, with an incredible cultural multiplicity, and with great business potential waiting to be explored. We are contributing to and preparing a better future for the Angolan people.
What is your strategy for growing your business portfolio within the oil and gas sector?
We are a 100% Angolan company. We believe in our market, and in line with this, we invested USD 4.5 million in the development of our new factory.
We sell various raw materials and produce cleaning and disinfection products. We usually sell to dealers, but now we want to sell directly to oil and gas companies.
At the moment the food industry represents about 80% of our sales. Our goal is to have oil and gas represent 20% of our sales this year.
Our strategy is to determine what oil and gas companies need in terms of related products and services, and then start having a local stock, and start producing products similar to the lubricants for the filling lines used in the food industry that we already produce in Angola.
How can local businesses address the demand for sodium hypochlorite after the new local content legislation?
Some products that can be produced here will now be protected by local content. The government will tax imports and the price difference will be huge. We will try to supply 10-20% of the demand of oil and gas companies for these products and the rest they can import. If we increase our capacity, we will grow as suppliers.
We need to form a network of companies and work together. We already have national production.
The issue of importing sodium hypochlorite from Europe, and bringing it by container, is that it will take two to three months. You buy with a concentration of 14% sodium and it will get here at a concentration of 7%. This generates huge losses and makes imports ineffective.
What are the most pressing challenges preventing domestic chemicals companies from accessing the oil and gas sector?
As the oil and gas sector is very visual, the companies tend to dismiss local chemicals players unless they have large-scale warehouses. This is one of the reasons behind the current expansion of our warehousing capacity onsite.
Another issue is the specialised work tools that have to be formed for an extremely technical industry. We’re already doing it, but the process is long.
In addition, local insurance companies don’t understand that we need insurance for product liabilities. For instance, if a client’s machine breaks down while using our product, we cannot get a local insurance company to certify the fault. So, we will seek insurance from companies outside of Angola.
Certification processes also have to be implemented; we have to be face to face with the best procedures positioning us competitively as a credible company.
Can you give us an overview of the company’s current production capacity?
What we offer here at Quimicoil is an integrated solution. We import raw materials, produce the final product to be sold by us or by third parties. We have all the machines on site to produce plastic packaging as well all labelling. We verticalise the entire production process.
We have 20,000 square metres of work space, our warehouse has 6,000 square metres and we have two more external warehouses with raw materials. We’re going through a major expansion. Our production capacity will be about 52,000 litres per day. Every year we have had an increase in our volume of business.
We started this project in 2017 as a cleaning products factory, but a lot of companies wanted to buy the raw materials that we used to produce our products, so we decided to offer these products to the market as well. The business grew very fast – in the first year alone, our turnover was almost USD 2 million. In 2020, our sales volume grew by 20-25%.
How do you plan to develop the in-house capacity to provide services and supplies to the hydrocarbons sector?
By the end of 2022, we will have in place a department with chemical engineers and mechanical engineers to provide support to the companies that buy from us in those two aspects. One of our goals is to get the ISO 9001 certification soon. This is essential to introduce the company to the oil and gas industry. These are goals that we are trying to achieve to be a strong partner for the oil and gas industry.
In 2020, we began to do our service with local technicians in the factories that do preventive maintenance in pumps, gas conduits and cleaning-in-place (CIP) services. Through partnerships, we began working with international chemical suppliers.
How should chemicals companies in Angola approach sustainability?
I think recycling and environmental sustainability will become very important to the government and will soon be a legal obligation. Recycling should be a concern. In our facility we recycle plastic drums and even buy plastic to recycle. We start with the recycling unit to reduce our environmental footprint. We have a moral obligation to leave a habitable planet for future generations.
In addition to this initiative, we also have our water treatment plant for treating wastewater.
Furthermore, we are studying the possibility of exporting recycled plastic, so that we can create value from waste and receive foreign currency to ensure a better trade balance.