Angola’s logistics growth in the energy sector TEY_post_Tiago-FERREIRA

Angola has everything in place to become one of the most important logistics players in West Africa.

Tiago FERREIRA Country Manager, Angola TLC

Angola’s logistics hub potential

May 23, 2022

The Energy Year talks to Tiago Ferreira, country manager of TLC in Angola, about the evolving demand for logistics services in Angola, the country’s potential as a logistics hub and the company’s recent expansion of its network. Switzerland’s TLC Group provides oil and gas logistics in Africa, the Caribbean and Latin America.

What is Angola’s potential to serve the region as a logistics hub?

Angola is a huge country with a huge economy. It has everything in place to become one of the most important logistics players in West Africa. There are a lot of opportunities given all the access, such as the railway in the south and the ports along the coast – particularly if the Cabinda and Caio port developments move forward, along with the international airport in Cabinda. We just need to know how to do the right investments and then take it further with a hub vision. The economic free zone (ZEE) has incredible potential.

TLC Angola has great importance within the group. We have trans-shipment cargoes from Congo-Brazzaville to Angola. We have transport from Angola to and from Namibia and South Africa by road. The access and options are very significant.

How has the recent oil price upturn impacted the demand for Angola logistics?

We are seeing optimism among companies in 2022, mainly due to the current oil price, as it influences how the major operators invest in the country.  As our current customers sign up to new projects and campaigns, we expect to see increased volumes throughout our full range of services.

In what way did the pandemic affect the demand for warehousing and inventory management?

Since 2020, we have been receiving more inquiries from customers regarding integrated storage solutions as they don’t want to manage a yard or a warehouse on their own. We can provide warehouse and yard solutions where we can store and manage their equipment.

Our goal is also to provide digital solutions for yard and warehouse management for our clients.  One of the benefits of our Strategic Alliance with Pentagon Freight Services is that we can now offer an online solution with full visibility down to line item status for any shipment to or from any global location.  This tool is already letting us extract reports for our clients, with simple, easy-to-understand commands for one-off or regular automated reports.

How have contracting trends evolved in the logistics sector over the past few months?

Companies are looking to subcontract more and more. If they can have one player to subcontract to, they are more comfortable with that. Logistics service providers like TLC have to offer our clients the full range of services they need, talk with them about the constraints and difficulties, then find solutions. Overall, 2020 was not a good year as it affected a large part of logistics activities. However, we did not experience this so much in freight forwarding, as we still handled a large volume of shipments. In fact, TLC has continued to grow progressively since 2019.

Yet, with 2021’s average oil price of USD 30-40 per barrel, there weren’t many investments, similar to what we saw in the previous years. We realised this as customers approached us to renegotiate prices and we had to adapt to maintain business levels. I think today’s barrel price [as of May 2022] of USD 93-94 is perfect for operators to be more confident about new investments and we look forward to supporting their requirements.

What is TLC’s footprint across the domestic energy value chain?

We cover almost the full cycle, from clients doing seismic activities here in Angola to customers doing installation and drilling. We are participating in the industry from A to Z in both upstream and downstream activities. We work with all the major international service providers, mainly through airport assistance, transportation, shipping activity and freight forwarding for import/export. Our strongest area is freight forwarding.

The downstream is perhaps the most difficult segment to enter. We are looking forward to more opportunities in this sector of activity.

Regarding the renewables scenario, there are some projects and we are in contact with people in relation to these. We don’t know exactly when they will start, but they will happen eventually.

How will your partnership with Pentagon Logistics affect your strategy of rendering services directly to major operators?

Our strategic alliance with Pentagon is very important. It is allowing us to grow as a company and enabling us to develop our procedures, expertise and IT tools. We’re also benefitting from the interchange of customer portfolios: we serve our customers better as Pentagon helps us in locations where TLC is not present and vice versa. Through Pentagon, TLC has achieved a worldwide reach. Global coverage is a huge improvement, and something that most international oil and gas companies require.

The partnership means our company has drastically improved its network. A major operator will always look for an agent that can offer solutions not only in Europe and Angola, but all around the world. This is the importance of our alliance with Pentagon. They offer us a coverage of solutions worldwide that we didn’t have before.

This was our main challenge when we wanted to contract directly with operators in the past. Everyone knows us and how we perform in Angola, but their main constraint was needing TLC on the other side of the world. Now that we have Pentagon as a partner, we can still offer a range of services with good quality in these faraway and key regions.

We have participated in tenders and we are quite optimistic for a few of them. We want to go direct with operators in Angola because we are comfortable with it. We can accomplish everything that they need with our full range of services. We have several plans with Pentagon this year. We are on our way and looking forward to contract awards.

To what extent is the Angolan market demanding C02 emissions reduction strategies from logistics companies such as TLC?

We see that companies are more willing to implement CO2 emissions reduction processes. Operators and service providers are asking for information on this specific aspect. We are feeling the impact of this movement, mainly from operators, and we need to share this information.

At TLC, we have a strong commitment to this aspect and, in our pursuit of relevant ISO certifications – 9001, 14001 and 45001 – we are monitoring our CO2 emissions and implementing tools where such an effect can be automatically measured and controlled.  We understand the Angolan environment is not perfect in this respect. However, for an African country, it is good that companies are already going in this direction.

What impact do you expect from the recent publication of exclusivity and preference lists related to the local content framework?

This will have a huge impact on foreign companies. I think it’s very important to encourage companies to establish themselves in Angola, pay taxes and create jobs for locals in order to boost the local economy. It is not suitable for a company to come from the outside, bring a lot of expats to do a project and then leave when the project is completed. As for TLC Angola, we are an Angolan-incorporated company and pay our taxes in-country, so we are covered by this law.

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