Land ahead

Angola

TOGY talks to Alberto Mendes, president of Grupo Simples, about onshore operations, Angolan companies and local content. In December 2015, Simples Oil & Gas was awarded a 30% stake in block Kwanza 6, one of the 10 onshore blocks auctioned by Sonangol. The company is currently working on the due diligence to become a full-fledged operator by 2017. The objective is to start exploration activities in Block Kwanza 6 in 2017.

• On land operations: “Onshore operations can help the Angolan economy to grow and modernise in a way that offshore operations cannot. For instance, offshore explorations are technologically more complex and local Angolan companies have always had difficulties in providing the necessary support services.”

• On local content: “Onshore production can provide opportunities for local content companies to be involved and participate in the exploration process, precisely because onshore activity requires less investment and is less technically complex. That many of these companies will be able to provide services will change the face of the Angolan oil industry.”

Besides touching on these topics, TOGY talked at length to Mendes about becoming an oil operator, competing with the majors and the benefits of onshore operations. Most TOGY interviews are published exclusively on our business intelligence platform TOGYiN, but you can find the full interview with the heads of Grupo Simples below.

What is the potential of Angola’s recently awarded onshore blocks?
We see a lot of potential in Angola’s onshore blocks. First, it is cheaper to produce oil from an onshore basin. Though the initial stage will require some investment in infrastructure, once this is in place the marginal cost of each barrel will be much lower than that of same barrel derived from an offshore block.
Moreover, onshore operations can help the Angolan economy to grow and modernise in a way that offshore operations cannot. For instance, offshore explorations are technologically more complex and local Angolan companies have always had difficulties in providing the necessary support services.
Onshore production can provide opportunities for local content companies to be involved and participate in the exploration process, precisely because onshore activity requires less investment and is less technically complex. That many of these companies will be able to provide services will change the face of the Angolan oil industry. We want to tap that potential.

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