universo29

Universo MARCH 2011

WINGED WONDERS:

how birds are boosting tourism

TRAINING FOR SUCCESS:

why studying abroad is a good career move

BANKING:

when growth is a pathway for investment

CLASS ACT:

building a new future for schools

Leaping ahead Sonangol 35th anniversary sparks celebrations around the globe

INSIDE:

oil and gas news

Board Members Manuel Vicente (President), Anabela Fonseca, Mateus de Brito, Fernando Roberto, Francisco de Lemos, Baptista Sumbe, Sebastião Gaspar Martins

Sonangol Department for Communication & Image Director João Rosa Santos

Corporate Communications Assistants Nadiejda Santos, Lúcio Santos, Cristina Novaes, José Mota, Beatriz Silva, Paula Almeida, Sandra Teixeira, Marta Sousa

Publisher

Sheila O’Callaghan

Editor

John Kolodziejski

Art Director Garry Lyons

Sub Editor Ron Gribble

Advertising Design Bernd Wojtczack

Circulation Manager Matthew Alexander

Project Consultants Nathalie MacCarthy Mauro Perillo

Group President

John Charles Gasser Universo is produced by Impact Media Custom Publishing. The views expressed in the publication are not necessarily those of Sonangol or the publishers.

Reproduction in whole or in part without prior permission is prohibited.

This magazine is distributed to a closed circulation. To receive a free copy: circulation@universo-magazine.com Circulation: 17,000

The Universo team while in Luanda stay at: www.hotelrouxinol.com Davenport House 16 Pepper Street, London E14 9RP Tel + 44 20 7510 9595 Fax +44 20 7510 9596 sonangol@impact-media.com Cover: Sonangol 2 SONANGOL UNIVERSO

INSIDE THIS ISSUE

44

ur second edition brims with good cheer as Sonangol not only celebrated its 35th anniversary but also announced buoyant provisional 2010 earnings. Sonangol marked the occasion with charitable donations, sporting and cultural events as well as by holding parties across the globe from Luanda to London, Houston and Singapore.

More good news stories contained in this issue include ‘Training for Success’ which looks at the rising proportion of Angolans taking up important positions in the oil industry.

Banking is a booming activity in Angola. We survey recent progress and interview a director of BAI, the country’s leading bank.

Central Angola’s industrial revival continues apace and we look at an innovative Huambo furniture factory, which uses new technology to upgrade existing timber reserves.

Lastly we reveal some of the largely unknown delights of the country’s ecology – a prospective niche for eco-tourism – in our story on rare Angolan birds.

12

O

Kamene Traca, Michael Mills, Carlos Moco, Capua. Esso

Universo is the international magazine of Sonangol

4 ANGOLA NEWS BRIEFING

6 TRAINING FOR SUCCESS

Angola’s President Jose Eduardo dos Santos makes his first state visit to South Africa; President dos Santos lays the foundation stone for the Cazenga regeneration project in Luanda; Angolan GDP grew at record rates through 2010; Angola pledges infant mortality cut; farm output rises; Angola runners-up in CHAN 2011; Road-race record

Angolans are returning home from their studies abroad and are taking up increasingly important positions in the oil sector, proving the success of the government’s Angolanisation policy

5 FIGURED OUT A brief glance at Angola in numbers

12 WINGED WONDERS Birdlife enthusiasts and biologists are combining to put Angola’s beautiful and largely unvisited interior on the map.

Eco-tourists are showing an interest in following their lead

CONTENTS

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30

22

22 CLASS ACT A Huambo carpentry factory is expanding output of much-needed school furniture by using an innovative wood treatment process which will make full use of local forestry plantations

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BANKING ON ANGOLA’S FUTURE Angola’s banking sector is expanding rapidly. A leading banker gives Universo an exclusive interview about the industry’s course of development

SONANGOL NEWS 38 SONANGOL NEWS BRIEFING

Angola subsalt exploration; palm-oil fuel project; Superleague Formula gets underway; Angola LNG project moves forward; deal with Cuba signed; Sonair expands operations; Sonangol takes interest in construction firm

40 SONANGOL 35TH ANNIVERSARY A run-down of Sonangol’s 35th anniversary celebrations and details of the company’s 2010 preliminary results

MARCH 2011 3

Angola news briefing South Africa state visit

Getty

President José Eduardo dos Santos made his first state visit to South Africa in December, underlining the historic and economic ties between the two countries. The president led a large delegation of top government ministers to Pretoria to meet his South African counterpart Jacob Zuma to discuss bilateral co-operation. Accords were signed in the areas of public works, infrastructure development, telecoms, information technology, energy and agricultural co-operation.

A declaration of intent on the use of finance facilities was also signed, paving the way for new South African credit lines for Angola. The first, from the Development Bank of South Africa, will be worth $255 million and managed in Angola by Banco Africano de Investimentos. The funds will be used for development and infrastructure projects. Further credit lines from the Industrial Development Corporation and the Export Credit Insurance Corporation mean the total could reach $3 billion, said Angola’s Foreign Affairs Minister George Chicoty.

Business leaders from both countries met on the sidelines to discuss opportunities in Angola.

President dos Santos, who travelled with his wife Ana Paula, made a short trip to Robben Island to see the prison where former president Nelson Mandela spent 18 years. In recognition of his personal contribution to the South African liberation struggle, dos Santos was bestowed the Order of the Supreme Companion of O. R. Tambo (Gold), the highest honour that can be given to a non-South African citizen. The order is named after the late Oliver Tambo who was the African National Congress’s president-in-exile for many years.

Fastest growth

President dos Santos has laid the first stone to launch a major inner-city regeneration project in the Angolan capital Luanda.

The project will run in four phases, with 20,000 homes being built in the first two years in the Cazenga district, currently home to 1.8 million people.

There will be a mix of apartments and houses for people currently living in unsuitable conditions in that part of the city.

The regeneration area covers close to 40 square kilometres and will include new water, electricity and sanitation infrastructure, as well as local services.

4 SONANGOL UNIVERSO

Getty

Cazenga regeneration

Angola was the world’s fastestgrowing economy in the last decade, its GDP increasing by 11.1 per cent between 2001 and 2010. A study in The Economist magazine citing IMF data found Angola in pole position, followed by China (10.5 per cent growth over the same period), Myanmar (10.3 per cent), Nigeria (8.9 per cent) and Ethiopia (8.4 per cent). Angola grew the most between 2004 and 2008, peaking at over 20 per cent in 2007, thanks to an increase in oil exports and high levels of direct foreign investment.

Figured out

1,000 6,800

Health pledge The Angolan government has pledged to reduce the country’s infant and maternal mortality rate by 50 per cent over the next two years. Deputy Minister of Health Carlos Alberto Masseca made the commitment at the National Forum on the Eradication of Poverty held in Luanda in January. The minister said there were plans to build new hospitals and improve local health services, and focus on improving sanitation in a bid to reduce diseases such as polio and cholera.

Years of conflict and poor infrastructure have left Angola with one of the highest child-mortality rates in the world, although government spending in recent years is starting to have an impact.

bank branches in Angola by 2013

Getty Angop

Road-run record

Achievement Angola’s national soccer team succumbed 0-3 to Tunisia in the final of CHAN 2011, the African Cup of Nations for home-based players on February 25. The runners-up position was the first major achievement of recently-appointed coach Lito Vidigal.

Rogerio Silva, chairman of the Angolan Olympic Academy, described the secondplace as “extraordinary”.

Angola beat Sudan 4-2, the competition’s host nation, on penalties in the semi-final after disposing of Cameroon in similar fashion in an 8-7 quarter-final shoot-out.

In the group stages, Angola beat Rwanda 2-1 and drew 0-0 with Senegal.

Angola also drew 1-1 with eventual champions Tunisia.

Ethiopian running legend Haile Gebrselassie won the 55th edition of Angola’s São Silvestre year-end race, setting a new course record time of 28 minutes and 5 seconds and taking the gold medal. The 10-kilometre event takes place in the capital Luanda every year on December 31. Kenya’s Josphap Menjou came second followed by 15-year-old Ethiopian runner Bonsa Diba Direba. Ethiopians took all three medals in the women’s race. Dire Tune won the gold, Almaz Ayana Eba the silver and Rehime Redir the bronze. Kenyan Grace Momanyi, who won in 2007, 2008, and 2009, came fourth.

Green shoots Government investment in agricultural projects is starting to pay off with increased yields during 2010. Cereal crops registered a rise of 125,000 tonnes (12 per cent up on 2009), according to the Ministry of Agriculture, Rural Development and Fishing.

Production of green and root vegetables were also up significantly on the previous 12 months, while fish caught off Angola rose by 3 per cent to over 180,000 tonnes.

In terms of rural development, 20 new health posts were built serving more than 18,000 families and a further 16,000 families benefited from new water and energy supplies.

25

km of roads currently being rebuilt

new electricity substations to be built in Luanda by 2012

7.6% Government’s growth forecast for Angolan economy in 2011

$200 million – Japanese investment into a new textile factory in Luanda

10,000 kilometre fibre optic network completion due this year

MARCH 2011 5

RETURNING ANGOLANS

TRAINING FOR

SUCCESS M

y generation is leaving a period hitherto lived by other generations in Angola. Never before have we had so many opportunities in terms of availability of jobs and career progression,” said Yvette Moco, human resources manager at Transocean, the largest oil-drilling contractor in the country.

Moco, who graduated in Sociology and French at Manchester University, said: “It was a great experience studying in the UK as it gave me the opportunity to develop analytical as well as interpersonal skills. I also had the opportunity to make many friends of different nationalities and get to know different cultures. But, above all, that’s where I grew up to become a responsible adult and shaped my personality in terms of management style. It definitely provided me with the necessary skills to get into the oil industry.”

Moco’s work is not restricted to her homeland. She is probably the first and the youngest HR manager in charge of three different locations in Africa. Apart from Angola, she has responsibility for Gabon and the Republic of Congo.

Angolanisation Moco’s career aspirations, along with those of many others, are supported by the government’s Angolanisation policy of raising the proportion of Angolans in company workforces.

Owing to shortages of specialist labour, oil companies operating in Angola have long been dependent on expatriates 6 SONANGOL UNIVERSO

to perform not only highly-skilled work but also many basic roles. This is now changing, especially at the top-end of company hierarchies as multinationals seek to meet government targets.

Besides providing jobs for local people, there are also powerful economic incentives for the Angolanisation process. It is extremely costly for companies to bring in foreign workers.

Apart from Luanda being one of the most expensive cities in the world for expatriates, there are also the added costs of flying personnel in from abroad on a monthly basis, sky-high hotel rates and inflated salaries to consider.

An independent oil industry analyst told Universo that expatriate rig-workers could easily cost a multinational in excess of $200,000 a year when long-distance travel and accommodation costs were taken into account, compared to around a third that amount for a local hire.

“In straight economic terms, an oil company incurs significant savings if it replaces an expat by an Angolan. The critical issue is that the Angolan must be technically capable and have good English language skills since the language of communication in the industry, especially offshore, is English,” he said.

“Safety is the top priority. Floating production, storage and offloading [FPSO] vessels operated in Angola produce at rates of some 250,000 barrels a day. The oil is highly flammable so there is no room for mistakes,” he stressed.

Carlos Moco

New generations of Angolans are training abroad and returning home to aid the country’s reconstruction by taking up key positions in the now buoyant economy.

Universo looks at some of their experiences

Pintoroux

More career opportunities for men and women - Yvette Moco, Transocean

MARCH 2011 7

RETURNING ANGOLANS

Esso

Excellent performance key to ‘individual success’ says Claudio Narciso

The benefits to multinationals are not only financial. Greater local staff numbers improve the company’s communication and cultural understanding of the host nation, and vice-versa, making operations smoother.

Angolans certainly see the benefits in terms of career opportunities and promotions, travel and access to high salaries in a widening pool of available jobs.

“Due to the Angolanisation process of the oil industry, we are now seeing more commitment from companies and, as a consequence, more career opportunities for both men and women. That said, we still have a lot of work to do in terms of developing people but we are on the right track,” said Transocean’s Moco.

Her own future is on track and she aims to continue to develop as an HR professional and specialise in the area of reward and talent management.

8 SONANGOL UNIVERSO

Claudio Narciso Esso reservoir engineer Claudio Narciso agrees that career opportunities are growing. “I can only speak for Esso Angola but I believe the situation is the same for other multinationals in the oil sector. At Esso Angola, by year end 2010, a total of 49 Angolans had reached supervisory and management roles”, he said. According to Esso, in 2009 Angolans were performing around 45 per cent of the overall leadership positions in Esso Angola.

Narciso is reserves co-ordinator for Esso Angola Block 15 where his main role is to maximise the economic recovery of oil and gas. He now operates at Esso’s hightech headquarters overlooking the bay in downtown Luanda.

In a two-and-a-half-year assignment in Houston, Texas, Narciso spent six months working on reservoir surveillance in a 40-year-old field to experience

situations Angolan fields may encounter in a few decades from now.

Regardless of Angolanisation, Narciso said opportunities for career progression would always exist, but were dependent on business needs and mostly on an employee’s performance. “We should never forget that excellent performance is the key to one’s success and is very important for those who want to assume positions of greater responsibility in the future.”

Narciso thoroughly recommends international training assignments. “A professional doesn’t just gain technical skills but also leadership skills and knowledge, which are extremely important for further career prospects.”

His career agenda includes putting something back into society. He also sees a mentoring role for himself. “My current plan is to grow professionally, and even to become one of the leaders of the company

Esso

Sara Cruz, production operator, trained in Canada

MARCH 2011 9

RETURNING ANGOLANS

“

Esso

Kizomba ‘B’, one of Claudio Narciso and Sara Cruz’s workplaces

Training abroad gives you the opportunity of working across different cultures

”

in the future, in order to contribute to the excellent growth Esso has had. I also have a moral duty to share what I’ve learnt so far and help the younger engineers achieve their goals,” he said.

Sara Cruz

Sara Cruz, a production operator trainee at Esso, currently working aboard a giant FPSO, spent 13 months training at Canada’s South Alberta Institute of Technology (SAIT).

Cruz listed the benefits of training abroad: “It broadens one’s view by continu10 SONANGOL UNIVERSO

ously developing in the industrial global village that is the oil sector. It gives you the opportunity of working across different cultures and improving your level of English, the essential business language.

“It also gives you the capacity of knowing how to overcome cultural differences in order to achieve smooth, efficient and effective results in any multinational industry,” she added, noting that most equipment, technology and processes are imported in Angola.

“It makes one feel much more secure and valuable by gaining knowledge from countries that have been running specific types of operations for a longer period of time,” she said.

Cruz echoed Claudio Narciso’s advice to young Angolans thinking of studying abroad. “Go for it, because it’s a remarkable experience,” she urged. “The skills they learn will allow them to move further in their careers, have better incomes and consequently a better quality of life.”

However, would-be students should only go abroad if they are willing to make

some sacrifices. “There’s no gain without pain,” Cruz warned. “Students must be prepared to be far away from the comfort of their families in a totally new environment.

“What I missed most about Angola were our sunny days, lovely beaches, our rich food and our friendly cultural environment in which we believe that friends, relatives and neighbours are all a large family,” remembered Cruz who comes from Luanda’s Sambizanga district.

All the interviewees stressed that the main thing they missed while being away were their families. But Cruz added that despite the difficulties, studying abroad added value to the Angolan labour market.

Hedson Cristovão Hedson Cristovão, a 25-year-old health and environmental safety officer at Sonangol, trained in Brazil. The leading Lusophone and soccer-playing country was a good choice for this lover of football.

“The positive side for me was to have acquired another culture, I am Angolan but

trainees receive an intensive six-month English proficiency course. This meets most work requirements and is followed by an additional six months on specific technical English, maths and science training provided by Canada’s SAIT. Thirty-one Esso trainees began this training in 2009.

The Esso trainees follow this with one-

year specialist courses in Canada and a final year initial work assignment with on-the-job training at one of Esso Angola’s offshore facilities in Block 15.

Esso estimates that it invests more than $300,000 in each trainee to Level 1 technician status. Some 400 Esso Angola employees were trained locally in 2009. �

Albero Juliao

Carlos Moco

apart from having graduated in Brazil I have gained a different kind of recognition here in Angola,” he said.

Born in Luanda’s populous and impoverished Cazenga district, Cristovão went to study abroad by a fortuitous route. He told Universo that his study grant followed the direct interest of the President of Angola.

Along with two brothers and a sister, he caught President José Eduardo dos Santos’s eye when they were reciting poetry at an official event.

The Cristovão children learnt their lines by heart and acted as a chorus when accompanying their father at ceremonies held at the National Assembly and other public ceremonies involving foreign dignitaries.

The application and discipline shown

by Cristovão’s family in their performances so impressed the president that the youngsters were offered educational grants by his philanthropic foundation Fundação Eduardo dos Santos in 2000.

Cristovão eventually studied in Brazil at the University of Lins in São Paulo’s rich farming interior. “My future plans are to improve the quality of life in my country and help the company where I work to grow,” he said.

Cristovão would also encourage Angolans to go and study abroad. “From my point of view, Angolan institutions don’t yet have sufficient credibility and structure to be able to compete with the quality of education in other countries,” he said.

Several initiatives to improve the overall quality of Angola’s educational system are going some way to meet these shortcomings. More teachers, 60,000 in total, are being hired to fill places in state-sector education in 2010 and 2011. There is also an ambitious nationwide school-rebuilding plan underway.

More specialist oil-sector training is available at the expanding National Petroleum Institute (INP) at Sumbe in Kwanza Sul province. The INP was set up by the government in 1983. According to INP director Domingos Francisco, 249 technicians completed courses there in 2009 and 560 trainees enrolled in 2010.

Oil companies also use the facilities offered by INP. There, Esso Angola technical

LEILA LOPES is another Angolan student tasting life by studying abroad. She is not only a student of Business Management in Britain but also has a possibly distracting alternative career path diversion.

Benguela-born Lopes was voted Miss Angola at the end of last year and will represent the country in the Miss Universe competition in Brazil next September.

MARCH 2011 11

BIRDLIFE ENTICES ECO-TOURISTS

Photos by Michael Mills 12 SONANGOL UNIVERSO

WINGED WONDERS

Angola’s wide-ranging, often thrilling, birdlife is attracting rising numbers of eco-tourists and birders. As newly rebuilt roads provide easier access to remote areas, opening up new tourism opportunities, Universo casts an eagle eye over recent birdlife projects

MARCH 2011 13

BIRDLIFE ENTICES ECO-TOURISTS

W

ith its diverse climate and landscape, ranging from desert in the south to tropical jungle in the north, Angola is a paradise for birds and even more so for birdwatchers.

It has the sixth-longest bird list in Africa with more than 900 species. Angola also has one of the continent’s most important “skin collections” – preserved bird bodies used for further study.

Once only a destination for the hardiest of ornithologists, Angola is now opening a new door to eco-tourism and scientific research projects, aided by government investment and extensive post-war reconstruction.

“Angola has beautiful scenery, a good variety of habitats and an interesting collection of endemics, that is birds only found there,” explained bird enthusiast and Afrotropics specialist Nik Borrow. “It deserves to be up there with some of the other major birding countries and, as word gets around about Angola, I think more and more birders are going to want to visit.”

Borrow, a Briton who runs birding trips across Africa, first visited Angola in 2005 and is due to return in October this year to lead a 17-day tour for BirdQuest, based in Lancashire, UK, through eight provinces.

Although remembering some difficult logistics and driving conditions from his first visit, he is optimistic things have improved since then.

“My overriding memory was that it was a very hard country to travel around,” he told Universo. “But I believe there have been substantial improvements, which is good. And it is definitely worth the effort to see the birds and also take in the scenery.

There are some very beautiful places: Tundavala in Lubango is just stunning and the Kalandula Falls in Malange are amazing.

“Diversity is one of the real beauties of Angola. It goes through the tip of the Congo

“

rainforest, through the Miombo [plateau savannah woodland], right down into the Namibian desert, so it’s a fascinating collection of habitats within a fairly small area and that makes it very interesting.”

Back in 2005, Borrow was lucky enough to spot all but two of Angola’s endemic species. This time around he is hoping to complete the list by seeing Pulitzer’s Longbill, listed as “endangered” by the International Union for Conservation of Nature (IUCN), and Swierstra’s Francolin, only rediscovered in Angola in 2010.

Most of the people on Borrow’s tour will be there for pleasure and to tick off their own world bird lists. But there is also a serious side to cataloguing species and monitoring habitats because Angola, which for many years was a no-go area for scientists, is now putting a new emphasis on research and conservation.

Michael Mills, a South African, first visited Angola in 1993 and is currently involved in several conservation projects, including one at the sloped Kumbira Forest in Kwanza Sul and another at Angola’s highest peak, Mount Moco in Huambo.

Working with local and international researchers, Mills is cataloguing bird life, assessing habitats, collecting specimens and helping on a nursery project for replanting vegetation.

As well as creating a database, the team is trying to conserve what is there by working with the local population to counter traditional but harmful practices such as logging and slash-and-burn farming. “From the moment I first went to Angola, I realised something needed to be done urgently about bird conservation,” said Mills. “The Kumbira Forest is the most important location for bird life in Angola, but it is under serious threat and so are the birds that live there.”

Many people fled to the forest during

Deserves to be up there with some of the other major birding countriesmore and more birders are going to want to visit.

14 SONANGOL UNIVERSO

Gabela Akalat

Gabela Bush-shrike

Monteiro’s Bush-shrike

Pulitzer’s Longbill

MARCH 2011 15

16 SONANGOL UNIVERSO

BIRDLIFE ENTICES ECO-TOURISTS

the war and started to farm. This destroyed bird and other habitats, putting the longterm future of the forest at risk, he said.

Kumbira – known as a scarp forest because it is on a steep slope formed by erosion or faulting – is home to four species on the IUCN global-conservation concern list.

The threatened four include Monteiro’s Bush-shrike, only found in Angola and Cameroon, and deemed “data deficient” because not enough is known about the species to decide on its conservation status.

The other three are found only in Angola and the IUCN considers them at risk: the Gabela Bush-shrike, the Pulitzer’s Longbill and the Gabela Akalat, which has not been seen for several years. This elusive bird prefers the rapidly disappearing lowlying vegetation in the Kumbira Forest.

In September last year, Mills and his team spent three weeks at Kumbira. Their focus was on the four endangered birds and they studied their habitats, vegetation, distribution and numbers. They also spoke to the local government administrator at Conda about the possibility of using some land for a nature reserve, mapped nearby communities and looked at some of the so-

Bird conservationist Michael Mills

cioeconomic factors that may influence future conservation initiatives in the area.

Equally critical as Kumbira Forest is Mount Moco, Angola’s highest point, at 2,620 metres. Located in Huambo province, at the heart of the country in an area known as the central highlands, the slopes of Moco are home to some of Angola’s largest remaining patches of Afromontane forest.

The mix of dense Miombo forest and

protea-rich grasslands, enjoying a wet summer and almost year-round mist, is a perfect place for birds and the insects and grubs they feed upon.

It is here that Borrow and his group will be hoping to spot a number of Angolan endemics, including the elusive Swierstra’s Francolin, the Angola Slaty Flycatcher and a local variety of the Yellow-bellied Waxbill known as Bocage’s Waxbill.

However, like Kumbira, Mount Moco’s birding habitats are also under threat as people living nearby are increasingly cutting down the trees for fuel and construction. “The forest is so small that even taking away just a few trees has a big impact, particularly as it leaves open spaces which are at bigger risk from bush-fires,” said Mills.

As in the case of Kumbira, Mill’s team is involved in a number of projects promoting local community awareness about preserving the environment. “Some people there tell us that the forests will last for ever and will never run out,” he said, “but others realise they are having to walk further each year to collect firewood, and can see the stream nearby is running much lower at the end of the dry season because there is less MARCH 2011 17

Spectacular landscape provides varied habitats

18 SONANGOL UNIVERSO

BIRDLIFE ENTICES ECO-TOURISTS

Infrastructure improvements are unlocking Angola’s eco-tourism potential

Bird monitoring in the Mount Moco reserve

water run-off from the trees.”

According to Mills, there’s a need to find a balance for the community, which for many years has relied on the natural environment for survival but now needs to adapt to the changing reality.

“It’s all about sustainability and that’s what we are trying to communicate, to use these resources in a sustainable way so they will last for future generations,” he said.

“We have given people more fuel-efficient stoves and are helping them find alternative construction material.”

Although Mills’ focus for now is on col-

lecting bird data and conserving habitats, longer term he believes Mount Moco definitely has potential for eco-tourism.

“Angola is a very diverse and beautiful country,” he said. “But until now there have been problems with infrastructure and it can be a very expensive destination. There is a lot of potential, particularly for expat tourism for the many foreign oil workers who live in Luanda and might want to explore the country on their weekends and time off.

“Mount Moco is only a few hours’ drive from Huambo so there is scope for regular

visitors. That’s something that could really benefit the local population if it were done in the right way.”

Much of Mills’ work is being done jointly with the Higher Education Institution for Education and Sciences in Lubango, home to Africa’s third-largest bird-skin collection.

A major project is the creation of an electronic database of the collection, which they hope to expand across the continent.

“It’s not been easy,” said Mills. “You can imagine all the faded handwritten labels in different languages. It’s taken a lot of time to decipher the entries, but we have more or less completed inputting. Now we are just tidying up and doing checks.

“The idea is that we can make this information available for everyone to use as a resource and we hope by taking these first steps we can attract more interest and more researchers to Angola.”

For Nik Borrow, the fact that Angola’s records are still a work in progress adds to the thrill. “I get a major kick out of seeing these rarely-documented species. Going to places like Angola and Somalia, where I have just been, you feel you can actually significantly contribute to ornithological knowledge, and that makes it really exciting,” he said. � Bird conservation work in Angola depends on financial support from organisations and individuals such as CGG Veritas, The A. P. Leventis Ornithological Research Institute, The Rufford Small Grants Foundation, The Conservation Leadership Programme, The Clancey Fund of the Percy Fitzpatrick Institute of African Ornithology, Julian Francis, The International Turaco Society and The Conservation Fund of the African Bird Club MARCH 2011 19

BIRDLIFE ENTICES ECO-TOURISTS

Gabela Bush-shrike

Gabela Akalat

Local Knowledge Francisco Maiato is part of the new generation of Angolan botanists. The 28-year-old is working on various conservation projects across the country including Mount Moco in Huambo and Kumbira Forest in Kwanza Sul. A graduate in biology from the Science Faculty at Agostinho Neto University, Maiato is based at the herbarium of Higher Education Institution for Education and Sciences in Lubango, where he also teaches.

The institution is also home to Angola’s 40,000-strong bird-skin collection. Part of Maiato’s job is contributing to a new electronic database of plant specimens, to preserve records for future generations.

Originally from Huambo, Maiato said his love of nature came from his father who was an agronomist. “I have always had a great fascination with nature,” he said. “My father was certainly a major motivation, but I have

20 SONANGOL UNIVERSO

Francisco Maiato

also had an excellent opportunity of training with some of the best botany specialists from South Africa.”

Maiato said he loved his time spent at Mount Moco and felt proud to be part of the work going on there.

“Despite some difficulties, like the high altitude and the winds, the natu-

ral environment is fascinating and it offers an opportunity for bird watching. “I really enjoy being there, talking and working with the local population and being able to understand that although they perhaps comprehend little of what we are doing, they have a great affection for the place and the birds and they feel the need to protect them.

“The work we are doing there is extremely important because it will help conserve this important ecosystem for the birds and classify Mount Moco as a priority area for bird conservation in Angola.”

His favourite bird is Ludwig’s Double-collared Sunbird, which is endemic to Mount Moco. “This bird caught my attention for its beauty and the bright colours around its neck,” he said. “Although its status is critical, you can still often see it at Mount Moco.”

New nature conservation areas

One of the fathers of Angolan ecology and conservation is Brian Huntley, a renowned conservation scientist who has worked across Africa and until recently headed the South African National Biodiversity Institute.

Huntley has played a major role in shaping environmental sensibility and research in Angola. His work includes the development plans for existing and new protected areas, as well as closely examining wildlife populations in the southern Namibian desert right up to lush Cabinda rainforest in the north.

Huntley’s research has resulted in 28 separate reports on the conservation and management of biodiversity in Angola, many of which serve as the basis for mapping and current scientific research.

Although officially retired, for the past year Huntley, Emeritus Professor at the University of Cape Town, has been working with the United Nations Development Programme (UNDP), developing an environmental programme for Angola in partnership with the Angolan government.

A large part of this is about creating the Angolan Protected Area Expansion Strategy (APAES) to preserve critical areas of natural interest.

There are 11 target areas, mainly moist lowland, escarpment and montane forest systems, covering a total of 11,800 square kilometres.

Huntley told Universo: “There’s a very narrow window of opportunity left

in Angola to identify and protect important areas such as those which haven’t yet been developed or inhabited. Once development starts, it’s much more difficult to protect an area.”

As part of his APAES work, this year Huntley will be travelling to a remote part of Lunda Norte, one of the target areas, for a mapping exercise.

“It’s a very important area,” he explained. “It has the largest lake in Angola, white-water rivers, gallery forests and extensive woodlands, and the landscapes are stunning and almost completely devoid of human occupation. It is in pristine condition, barely visited by humans and will be perfect for a national park.”

The Lunda Norte team will be made up of mostly Angolan students, handpicked by Huntley who is passionate about furthering homegrown scientific research.

“For many years, perhaps as many as 30, there have been very few Angolan scientists and very few who have studied their own environment, which has led to some serious gaps in local knowledge” he said. “But I am quite encouraged by a new generation of Angolan graduates who are showing new enthusiasm for finding out more about their own country.

“Many have been lucky enough to have been educated abroad or have had the chance to travel – but they are certainly more willing to go into the bush to discover their own country.”

In Huntley’s view, it is important that Angolans become interested in their own environment because it will foster a greater sensibility in the future.

“There are several generations who for various reasons are not familiar with environmental sensibility, and until now there has been a lack of political will to confront the issue.”

He added that much work was required to help Angola protect its valuable natural resources – but he said the outlook is increasingly positive.

If you are interested in supporting further bird conservation work in Angola, please contact Michael Mills on birdsangola@gmail.com.

Payment for photographs used in this article has been donated to the Kumbira and Mount Moco Projects.

For more information on projects and bird tours: www.mountmoco.org www.birdsangola.org. www.birdquest.co.uk www.birdlife.org www.birdingafrica.com The following birds are endemic to Angola and many are listed by International Union for Conservation of Nature (IUCN) as endangered or critical.

Grey-striped Francolin Francolinus griseostriatus Swierstra’s Francolin Francolinus swierstrai Red-crested Turaco Tauraco erythrolophus Red-backed Mousebird Colius castanotus Gabela Akalat Sheppardia gabela Angola Cave-chat Xenocopsychus ansorgei Pulitzer’s Longbill Macrosphenus pulitzeri Angola Slaty Flycatcher Dioptrornis brunneus White-fronted Wattle-eye Platysteira albifrons Gabela Bush-shrike Laniarius amboimensis Braun’s Bush-shrike Laniarius brauni Monteiro’s Bush-shrike Malaconotus monteiri Gabela Helmet-shrike Prionops gabela Ludwig’s Double-collared Sunbird Cinnyris ludovicensis Golden-backed Bishop Euplectes aureus MARCH 2011 21

i stock

A FURNITURE FACTORY’S REVIVAL

22 SONANGOL UNIVERSO

CLASS ACT Steam trains once puffed over Angola’s central highlands, fuelled by logs from specially planted eucalyptus forests. Now the steam age has passed but the wood has gained a new role as raw material for much-needed school furniture to serve new generations of pupils

MARCH 2011 23

A FURNITURE FACTORY’S REVIVAL

H

uambo, perched high on Angola’s central plateau, is home to a fledgling furniture industry now playing a key role in furnishing local schools. Taking advantage of ample supplies of eucalyptus trees, the furniture factory run by HabiTec Social Enterprise is now producing high-quality desks, chairs and other wooden fittings to meet the needs of the country’s expanding school system.

Around 80 per cent of Huambo’s schools along with their equipment and furniture were destroyed during the country’s long civil war, but since peace returned in 2002 there has been an exciting rebirth in educational provision with pupil numbers rocketing, handing HabiTec a huge and urgent market for its products.

Angola’s eucalyptus forests stretch along its railroads and were originally created to supply wood to power steam locomotives in the absence of other local fuels.

Steam trains along the Benguela Railway crossing Huambo and central Angola ceased to run in the 1970s, effectively ending mass timber consumption.

A revamped Benguela line will reopen in late 2012, but the wood-guzzling locomotives have been replaced by modern diesel engines.

Meanwhile, the abandoned eucalyptus trees, left untended, have grown higher and gained greater girths, enhancing their suitability for furniture-making.

Angola has 148,000 hectares of nonnative tree plantations, mainly eucalyptus, with over a third of the total belonging to the Benguela Railway Company. HabiTec’s

project provides a new purpose for these thousands of hectares of forestry.

HabiTec has 45 employees, including seven administrative staff. Manual jobs include sawing-machine operators, mechanics and maintenance teams. Another 500 workers on temporary contracts are employed during the year to assemble and distribute the factory’s output.

Ambitious growth According to Felisberto Capamba, HabiTec’s managing director, installed capacity at the factory is 200 units a day of desks, chairs, chalkboards and other pieces of educational furniture.

The company has an arrangement with the Angolan government to produce school furniture worth about $30 million over the next five years for its schools-rehabilitation programme. This amounts to 40,000 units produced every six months.

Many provincial governments and other state agencies have also shown interest in HabiTec’s products and services, said Capamba.

In order to gain manufacturing knowhow, raise production standards as well as efficiency, HabiTec has forged a partnership with a leading foreign eucalyptus furnituremaker.

The furniture-maker’s identity, withheld for competition reasons, has supplied and installed machinery at the HabiTec plant and also advises on personnel training. The aim is for HabiTec to emulate that company’s successful production model in other countries.

The future looks bright for enterprises

ATLANTIC OCEAN

Catchiungo

Lobito

Kuito

Benguela

Ukuma Huambo Forestry project

Alto Catumbela

0

ANGOLA

24 SONANGOL UNIVERSO

Provincial capital

Benguela railway

Town, village

Provincial boundary

0

50

100 km

50 mi

Forestry technology and sustainabilty

Capua

HabiTec has 45 employees, including seven administrative staff. Manual jobs include sawing-machine operators, mechanics and maintenance teams

i stock

HabiTec has not been content with building a utilitarian factory for its school furniture. Instead it is adding extra value by introducing new techniques to upgrade the quality of the timber it uses.

Thanks to a technology transfer deal with a major South African eucalyptus timber company, HabiTec is using a kiln-drying process that produces hardwood with greater resistance and durability for use in joinery, furniture manufacture and construction.

Following the example of the South African company’s long-running sustainable forestry policy, HabiTec has impressive green credentials. The Angolan company involves the local communities where it operates and has created its own nurseries. It plants two new eucalyptus saplings for every piece of furniture produced.

HabiTec also benefits from a partnership with Angola’s Forestry Development Institute (IDF), which is also proactive in reforestation.

Andrade Moreira Bahu, head of IDF in Huambo province, announced the planting of 100,000 saplings in the region between November 2010 and February in 2011. The trees are eucalyptus, cedar and pine. The saplings will not only replace forestry felled for a low economic return such as charcoal, but also help reduce soil erosion.

MARCH 2011 25

A FURNITURE FACTORY’S REVIVAL

“

We aim to improve productive capacity, focusing on school furniture as the government has established targets to improve the quality of teaching

Felisberto Capamba

”

such as HabiTec in seeking to serve Angola’s educational sector. “We aim to improve productive capacity, focusing on school furniture as the government has established targets to improve the quality of teaching and reduce illiteracy. In order to do this, there needs to be physical school infrastructure – and quality school furniture is the basis of this programme,” said Capamba.

The government’s construction priorities include rebuilding and equipping thousands of war-damaged schools and it has set aside $16 billion for education in its 2011 budget.

26 SONANGOL UNIVERSO

Social enterprise HabiTec, founded in 1998, is a social enterprise aiming to contribute to the rebuilding of Angola.

Parent company Development Workshop (DW) is a highly respected non-governmental body active in Angolan social projects for 30 years. As international funding ebbed after civil war ended, DW transformed some of its projects into commercially-based companies, managed under the umbrella organisation HabiTec Social Enterprise.

The country faces the challenge of rebuilding its social, physical and productive infrastructure. HabiTec has clearly identified the economic and social sectors where its know-how can be most effective. Its furniture factory is just one area where the company is engaged not only in creating jobs and replacing imports, but also in providing a growing population with access to basic services and educational opportunities through investing in local productive capacity.

The government offers support to HabiTec through credit lines granted through the Angola Development Bank and has also given incentives for local industrial production. HabiTec’s ties with the public sector are also evident in its close co-operation with Angola’s Ministry of Public Administration, Employment and Social Security, as well as municipal authorities.

Training key The human element in projects such as HabiTec is fundamental, so training is a major ingredient in its success. In this area the United Nations Development Programme has played a decisive role through its subsidiary African Management Services (AMSCO), which aims to make African companies globally competitive, profitable and sustainable.

AMSCO finances training at HabiTec to the tune of $30,000 a year. It has strengthened HabiTec’s personnel by identifying people showing enterprise and managerial potential, and then training them. It has also supported the training of factory technicians.

Felisberto Capamba led the initial process of creating HabiTec as a legally constituted company, drawing up the business plan and developing its administration. The second step, he said, was appraising the market to see how the furnishing industry would operate within it.

This involved a deep understanding of the state’s policy on rebuilding Angola’s industrial capacity. A further step was to examine the possibilities of obtaining local and international finance for the company and to seek partnerships.

“In getting involved in this process, I did it with great satisfaction because I was prepared for the challenge,” said Capamba.

“Considering my training in administration

Capua

Educational provision is booming as Angolans slake their thirst for learning. The number of pupils enrolled in schools more than doubled to 5.74 million in 2008 from 2.56 million in 2002.

This figure is set to increase even more sharply as Angola targets its programme of Education for All by 2015, with an ambitious benchmark of cutting the current rate of illiteracy from more than 50 per cent to 16.5 per cent.

Minister of Education, Dr. Pinda Simão, has said that to meet this need 30,000 new teachers were recruited in 2010 to breathe new life into the school system, and a further 30,000 will be recruited this year. HabiTec’s contribution will be helping to supply a more attractive and comfortable teaching and learning environment.

Training has strengthened HabiTec’s potential

MARCH 2011 27

High technology helps meet demand

28 SONANGOL UNIVERSO

A FURNITURE FACTORY’S REVIVAL

and company management, long years working at DW, and the fact my training was in part the fruit of the policy and my career at DW, my commitment could be in no other way.”

Water project Apart from schools, other social infrastructure such as water supplies and housing were destroyed during the civil war. To repair this damage, HabiTec also meets equipment and expertise demands in these key areas.

The government’s Water for All programme seeks to double the number of people with access to affordable water by 2015. It aims to build village and municipal water-supply systems as well as guarantee sustainable maintenance to 80 per cent of the country’s rural and peri-urban communities.

To go some way to meet government needs in this area, HabiTec also oversees a water-sector project, HabiAgua, which aims to improve access to water by building wells and selling water pumps, pump spares and well-construction material.

HabiAgua also trains local communities in the management, operation and maintenance of their water-supply equipment.

provides settlement planning, land registration and land allocation services to provincial governments, addressing an acute need for these services for millions of Angolans who were displaced during the war years. �

Managing director Felisberto Capamba HabiTec’s dynamic administrator, Huambo-born Felisberto Capamba, 38, developed a career in administration as part of the team of veteran NGO, Development Workshop.

“Today, the main task is to consolidate the enterprise, strengthen partnerships, identify potential clients, reach targets and make our processes effective and efficient,” he said.

Equally important, he added, is “to maintain the enterprise’s social vision and contribute to the industrial development of the country”.

Capua

Home help President José Eduardo dos Santos has made a commitment to build 1 million houses for social needs by making land, sites and services available for individual owners, and supplying hardware for lowcost construction. Complementing this policy, another HabiTec entity, HabiTerra, MARCH 2011 29

Banking on Angola’s future Angola’s financial sector has taken giant strides in recent years, attracting foreign players and expanding services throughout the country. Now it is eyeing opportunities further afield

30 SONANGOL UNIVERSO

BANKS

A

ngola’s soaring economy has been exciting the interest of foreign investors since peace returned some nine years ago. Nowhere is this more in evidence than in the booming banking sector.

Luanda, the capital, is now the thirdlargest financial centre in Sub-Saharan Africa, after Johannesburg and Lagos. Hosting 20 commercial banks, compared to just six in 1999, the metropolis currently has around a further ten more banks awaiting operating licences.

South Africa’s Standard Bank recently opened a branch in Luanda, becoming the first non-Portuguese foreign bank to offer full banking services in Angola.

Meanwhile, the first private equity fund exclusively for Angolan investment has been launched and brokers are now moving in ahead of the opening of Luanda’s stock exchange – Bolsa de Valores e Derivativos de Angola (BVDA).

Domestically, banks have enjoyed strong growth with significant branch expansion.

Electronic card payments rose by 88 per cent between 2008 and 2009, according to the “Angolan Banking Sector

Analysis,” a report published by KPMG in December 2010.

KPMG noted that while the economy slowed during 2009, the banks had continued to enjoy substantial profitability with commercial assets increasing by nearly a third, deposits by 64 per cent and credit by 59 per cent. The report’s analysis of cost to income ratios also found Angolan banks to be among the best in the world.

“Although this is a young sector, it’s amazing to watch how quickly it is evolving, both in terms of growth indicators and in maturity of its regulatory framework,” said Sikander Sattar, board director at KPMG Angola.

The positive feeling around the sector comes as Angola picks itself up after a tough two years of slowed growth and liq-

“

financial sector will be a real motor for growth

”

Edward George, an EIU senior economist

uidity pressures caused by the global financial crisis. The country’s gross domestic product (GDP) enjoyed an average annual growth rate of 16.9 per cent between 2004 and 2008, peaking at over 23 per cent in 2007, but the fall in the price of oil, the country’s main export, led to the economy flat-lining in 2009.

Brighter outlook Economic activity picked up in 2010, although less than had been hoped. Government growth forecasts were revised downwards for the year from an initial near 7 per cent to a more modest 2 to 4 per cent.

However, the outlook for 2011 appears decidedly brighter.

The London-based Economist Intelligence Unit (EIU) expects Angola’s growth to outpace that of both South Africa and Nigeria in the coming years and for its GDP to average a very healthy 7.4 per cent a year between now and 2015. “It’s obvious that growth is returning to Angola, and I believe the financial sector will be a real motor for that growth,” said Edward George, an EIU senior economist, who sees Standard Bank’s entry into the banking market as a significant step for attracting more diversified foreign investment into the country, particularly from South Africa.

Pedro Pinto Coelho, chief executive at Standard Bank in Angola, certainly hopes this is the case. “Standard Bank is present in seven countries in Africa and seven countries outside of Africa. We know Angola well and we know the difficulties many international investors have in understanding Angola,” he said. “What we’re trying to do is ensure that investors get to know Angola better and have more confidence about investing there,” he added, acknowledging that there has been some hesitance due to negative publicity.

Corbis

Exchange start-up Meanwhile, with renewed hopes that the stock exchange may start operating in 2012, several brokers and asset management companies are setting up new offices in Luanda.

Among them is Imara Securities Angola, part of Imara Holdings, a Botswanalisted investment-banking group with MARCH 2011 31

operations in several African countries and additional associations in the UK and United Arab Emirates.

Anthony Lopes Pinto, Imara Securities Angola managing director, is extremely buoyant about the country’s financial sector potential and believes it could one day even rival South Africa.

“We are in Angola pre-emptively with a view to broking on the stock market once that opens,” he told Universo. “In the meantime, we are focusing on corporate finance activities, acting as a broker for local companies in terms of raising capital and also brokering acquisitions. These are simple transactions we can focus on until the capital markets get started.”

Another key development for Angola’s financial sector is the launch of the Angola Private Investment Fund (FIPA), run by fund management company Angola Capital Partners.

The idea for the project came from the state-owned Norwegian Investment Fund for Developing Countries (Norfund).

“Norfund had been eyeing Angola for a while because it saw a lot of opportunities in the country’s non-oil sector and business opportunities for private equity operations,” said FIPA’s managing director Tiago Laranjeiro.

Promoting the fund in partnership with Norfund is Angola’s largest commercial bank, Banco Africano de Investimentos (BAI). The two have made a joint commitment of $15 million to the First Close, the initial round of a financing agreement valued at $28 million.

32 SONANGOL UNIVERSO

The other founding investors are the European Investment Bank, the Danish Industrialisation Fund for Developing Countries and Angolan bank Banco Privado Atlântico (BPA). Speaking as the fund prepared for its Second Close, Laranjeiro said: “So far, there has been great acceptance because the SME [small and medium enterprise] sector was starving for this kind of institution which could help them out with long-term financing.”

Also hoping to enter this new lucrative asset market is Portugal’s Espírito Santo Investment (ESI), which has applied for a licence to operate alongside its Angolan commercial banking subsidiary Banco Espírito Santo Angola (BESA).

“Our strategy is to be innovative and try to enter into new markets. We are the only asset management company in the country right now and we are positioning ourselves to be a broker company for when the stock exchange is launched,” said Manuel Reis, ESI managing director.

Investment call Reis echoed FIPA’s Laranjeiro in calling for more ways to bring foreign direct investment into Angola’s non-oil sector, especially into areas such as infrastructure and industrial development.

Bringing new direct foreign investment into the economy is also firmly on the agenda of Angolan banks. BAI has overseas branches in Cape Verde and Portugal and recently opened a representative office in Johannesburg, the first Angolan bank to do so.

Brazuk Ltd

BAI’s downtown HQ

“

We want to create pathways for investment into key areas of the Angolan economy and opportunities for partnerships

BPA chairman Carlos José da Silva

”

Building on its South African ambitions, BAI announced in December that it would be managing a $255 million credit line from the Development Bank of Southern Africa and the African Development Bank.

The credit line, signed during Angolan President José Eduardo dos Santos’s visit to South Africa, was the first of its kind between the two countries and will finance infrastructure and development projects. It mirrors a model used by Angola and the China Development Bank.

Another bank also spreading its wings is BPA. Despite opening only in 2006, BPA already has a branch in Portugal, dealings in Brazil and China, and plans to launch operations in the United States by 2013.

“With a multi-geographical presence in various continents, we intend to increase the capacity of attracting financial re-

BANKS

New banks add light to Luanda

Overseas expansion Carlos Rosado, an economist at the Catholic University of Angola, agrees that overseas expansion of Angolan banks is vital for the growth of the country and its financial sector. “While the banking sector has benefited from the growth of the Angolan economy, I think it’s now important for Angolan banks to start looking beyond Angola,” he said.

“Some have started with Portugal and South Africa, but they should also be looking at neighbouring countries such as Namibia because I think that the future for Africa is regional integration, trading between countries. If regional integration improves it will create lots of opportunities for Angolan banks.”

As Angola’s financial sector has grown in size, so too has its regulatory framework.

During 2010, several new laws and reforms were brought in by the country’s central bank, Banco Nacional de Angola (BNA), aimed at streamlining operations and offer-

ing more security for investments.

These include new anti-money laundering legislation, a new risk-management department, plans to overhaul the country’s tax system and several other consolidation programmes.

Measures have also been introduced to reduce the liquidity pressures felt in 2009 after the fall in the price of oil. These include restricting foreign exchange transactions above $100,000 (a fifth of the previous limit) and a new requirement for foreign oil companies to use local banks for their transactions with subcontractors and staff, a move which some say could inject as much as $10 million into the Angolan banking system.

“This new legislation is going to significantly increase the amount of transactions and actual assets being held in accounts in Angola, which I is going to be quite a big factor in contributing towards future growth,” said Imara Securities Lopes Pinto.

Reflecting on the various changes within the BNA during 2010, its newly appointed governor José de Lima Massano told reporters in Luanda that reform would continue to dominate the year ahead, and repeated a government pledge to reduce inflation, which hit 16 per cent in November.

“The year 2011 will be demanding and intense, but we have the commitment and collaboration,” he said. “Sustaining the national economy means maintaining a sound, efficient and competitive financial system, engaged and committed to the development and welfare aspirations of society as a whole.” �

GROSS DOMESTIC PRODUCT

18.5%

25.1%

9.5% 15.1%

19% 12.8%

BAI (Banco Africano de Investimentos) BFA (Banco Fomento Angola) BIC (Banco BIC) BPC (Banco de Poupança e Crédito) BESA (Banco Espírito Santo Angola) Others

ANGOLA GDP GROWTH 25 23.3 Annual growth (per cent)

sources to be invested into Angola,” says BPA chairman Carlos José da Silva, “and increase technical assistance to strengthen the international expansion of national economic groups to help them act proactively overseas.

“We want to create pathways for investment into key areas of the Angolan economy and opportunities for partnerships for investment in electricity, energy, infrastructure and manufacturing. These are all long-term sectors, vectors for the sustainability of the country.”

20

20.6 18.6

15 13.0 10 5 0

2.4 2005

2006

2007

2008

2009

Source: Ministry of Finance, Ministry of Planning

ANGOLA BANKING SNAPSHOT Commercial banks 20 Bank branches 720 Employees 11,000 Net assets $4.3 billion Source: Angolan Banking Association – 2010 MARCH 2011 33

BANKS

Money, money, moneyit’s a growth business Banco Africano de Investimentos (BAI), Angola’s largest bank, is enjoying high levels of growth and profitability. Universo asked executive director Inokcelina dos Santos what lay behind BAI’s star performance

Y

ou have won several prestigious international awards – what is it about BAI that stands out?

BAI’s reputation is based on its good financial performance and the solidity of its funds, strategy and business model. Based on these factors, the bank has managed to retain and strengthen its relationship with strategic clients who have the greatest growth and have contributed most to the economic development of the country.

BAI enjoyed a 66 per cent rise in net profits between 2008 and 2009 – what was the main driver behind that?

BAI has always adopted a conservative stance in relation to its risk exposure and been managed in a very prudent and sustainable manner. This has enabled BAI to grow by 112 per cent in 2008 and 39 per cent in 2009, which reflects net profits of $166 million in 2008 and $231 million in 2009. These results are sustained by BAI’s excellent client portfolio, by its range of products and by a business model adapted to each business sector by a skilled bank staff. These factors have enabled the bank to achieve a good financial performance and increase banking income by 63 per cent in 2009.

Are you expecting such strong results for 2010?

According to the IMF, Angolan GNP is expected to grow by 4 per cent in 2010 (2 per cent more than in 2009) while growth of 5.5 per cent is projected for 2011. Despite the slowdown of the growth rate since 2009, the Angolan economy has benefited from 34 SONANGOL UNIVERSO

the increase in the price of oil on international markets. This has enabled it to stabilise its net international reserves (NIR) since the fall at the beginning of the 2009 financial year. This stability has provided the government with room for manoeuvre in order to meet its financial commitments and has increased general liquidity.

This situation has benefited the banking sector and led to an increase in the volume of bank deposits and to an increase in the volume of credit granted. Accordingly, and despite the fact that there are still some vestiges of the international financial crisis, the forecasts for a better year in 2010 are satisfactory.

You were among the first Angolan banks to offer telephone and internet banking – has this been a success?

Yes. BAI’s electronic banking services gave our clients an alternative form of access to banking services. These services, particularly SMS [text messaging] banking, have enabled BAI to be nearer to its clients as a consequence of the major market penetration achieved by mobile services. In 2010, 15.18 per cent of BAI’s clients had access to electronic banking. The number of BAI clients using SMS banking increased from 0.34 per cent in 2008 to 9.43 per cent in 2010, while the number of users of internet banking increased more than 311 per cent between 2008 and 2010.

There has been a lot of reform within the Angolan central bank in the past 18 months – how do you think this will impact the commercial banking sector in Angola?

Banco Nacional de Angola has implemented a number of measures to improve the performance and reduce the risk of the Angolan financial system. The main measures that have had a direct impact on commercial banks in Angola were the reduction of obligatory reserves, new compulsory foreign-exchange exposure limits, the approval of the Anti-Money Laundering and Terrorism Funding Law and the opening of the Central Risk Office.

These measures required commercial banks to be more cautious in the management of their liquidity, which resulted in more sustainable growth and greater financial solidity. They had no negative effects on most commercial banks, which have continued to play the role of market dynamisers and funders, in line with the programme for the development and reconstruction of the country.

Since being licensed in 1996, BAI is now Angola’s largest bank; do you continue to keep expanding within Angola?

BAI intends to retain its position as the market leader in Angola by offering products and financial solutions that stimulate the economic and social growth of all the markets in which it does business. BAI will also continue to support the government’s efforts to diversify the economy.

You have operations in Cape Verde and Portugal, business in São Tomé and Brazil and a representative office in Johannesburg – do you have further plans for international expansion?

BAI will continue to strengthen its ability to become a preferred conduit for interna-

“

It is inevitable that the banks must go public if we want an evolved and transparent banking sector

”

tional trade and foreign investment in and from Angola, by adapting its strategies to each market. BAI monitors the evolution of the market, particularly in relation to countries such as China, the United States and the United Kingdom, which, because of their commercial relations with Angola, merit the bank’s particular attention.

We therefore, seek to create a permanent presence in those markets with significant commercial and financial relations with Angola.

What is the main role of your Johannesburg office (as you are not offering banking services there)?

The main role of the representative office in Johannesburg is the creation of platforms from which to access the South African market, the identification of lines of credit to fund new projects, the establishment of strategic partnerships with companies that wish to invest in Angola, and also to be a base for the training of bank staff and BAI’s relations with corresponding banks.

What will BAI’s role be in the DBSA credit line signed between Angola and South Africa?

DBSA together with a banking syndicate is going to provide BAI with a $255 million

line of credit to fund projects in the industrial sector within the ambit of the Angolan government’s growth plan for the sector.

This line of credit is expected to be guaranteed by the government, and BAI will be the investors’ access point to the funding.

When the Angolan stock exchange opens, will BAI be listing?

The growth rates expected for the Angolan banking sector give us reason to believe that it is inevitable that the banks must go public if we want an evolved and transparent banking sector. However, the opening of BAI’s share capital to the public does not have to coincide with the opening of a stock market. Nonetheless, BAI is certainly in a position to be listed on the stock market, which will enable it to expand its investment-sourcing options, clearly benefiting its business. We also consider that listing the bank on the stock exchange will also increase its market credibility. � MARCH 2011 35

Sonangol news briefing Subsalt treasure hunt

E

xploration of deepwater subsalt blocks off the Angola coast has begun,

says Sonangol’s business director Carlos Saturnino.

Announcing the start-up as “an historic landmark”, he said exploration of the subsalt layer was different from normal offshore oil drilling and involved greater Subsalt is so named because the oil deposits lie below a thick salt layer. A similar subsalt exploration area on the opposite side of the Atlantic in Brazil has been revealed to hold huge oil deposits.

The oil is located between 2,000 and 5,000 metres below the sea.

Oil companies selected to operate some of the Angolan subsalt blocks include China Sonangol, BP, Cobalt International Energy, Sonangol Pesquisa & Produção, Repsol,

Superleague

investment and technical complexity.

Superleague revs up Superleague Formula by Sonangol aims to hold its motor races in venues further afield in 2011. Last year, it ran events beyond Europe with two in Beijing and Inner Mongolia, China. The organisers now have venues in the Middle East, Latin America and Australia in their sights for this year’s 12-round, 36-race competition.

Superleague Formula races 750bhp cars with V12 engines. While Sonangol

sponsors the league, leading soccer clubs lend their names to individual driving teams.

The Anderlecht team, sponsored by the Belgian football club, narrowly beat team Tottenham Hotspur, backed by the English Premier League club, to win the overall winners’ prize of €1million for 2010. Superleague Formula will have the same total prize money of €5 million on offer to competitors in 2011 as last year.

Superleague Formula by Sonangol – Fixtures 2011 Round

Venue

1

Monza

Italy

2

Algarve

Portugal

May 7/8

3

Assen

Holland

June 4/5

4

Nürburgring

Germany

June 18/19

5

Navarra

Spain

July 2/3

6

Zolder

Belgium

July 16/17

Campos Basin off the coast of Rio

7

Donington

UK

August 6/7

de Janeiro with its first drilling

8

Ordos

China

September 11/11

9

Beijing

China

September 17/18

10

Non-European

October

11

Non-European

October

12

Non-European

November

Total E&P Angola, Eni Angola, ConocoPhillips and Statoil ASA. Meanwhile, Sonangol’s Starfish oil exploration arm has begun gaining subsalt experience in Brazil’s

campaign. Starfish’s pioneering well, 1STAR19RJS, will drill down 5,625m at a sea depth of 853m.

36 SONANGOL UNIVERSO

Date April 16/17

NEWS

Raising the roof Construction of the giant Angola liquefied natural gas plant at Soyo, Northern Angola, is on track to start operations in early 2012. A major milestone was reached with the recent placing of a 930-ton roof on a huge storage tank with a capacity of 159,000 cubic metres. The tricky construction operation was achieved by using an inflatable balloon, which gradually pushed the steel roof upwards and into place.

The LNG plant will eventually host four of the massive tanks, each with the capacity to fill a gas-tanker shipment. The Angola LNG project, which will produce 5.2 million tons of liquid gas a year, is jointly owned by Sonangol (22.8%), Chevron Gulf Oil Company (36.4%), and BP, Eni and Total which each hold 13.6%.

Cuban deals Sonangol E.P. signed a production-sharing agreement on December 8 with Cuba’s Comercial Cupet for two offshore blocks in the Gulf of Mexico. Sonangol will operate blocks N23 and N33, north of Pinar del Rio province.

Sonangol already has partnerships with Cuba in an onshore block in Angola as well as in Venezuela’s Orinoco region.

In the Venezuelan enterprise, local stateoil concern PDVSA has 60% while Sonangol and Comercial Cupet each have 20%. The Venezuelan fields are expected to produce 94 million barrels of oil over five years.

Palm-oil power Sonangol is exploring the idea of working with Italy’s Eni to jointly produce biodiesel in Angola. The proposed scheme aims to make use of abandoned palm oil plantations by producing fuel from the plants. Angola’s Oil Minister, José Maria Botelho de Vasconcelos, said in January that the Ministry of Agriculture would map areas of the country suitable for supplying the palm oil.

Many countries are increasingly adding biodiesel to diesel in heavy vehicles, especially urban buses, to reduce pollution. Brazil, for example, also uses biodiesel for its large fleet of railway locomotives. The biodiesel can often be conveniently produced and used in remote rural areas a long way from oil refineries.

Biofuel has the further advantage of being a renewable, sustainable product and cuts the use of fossil fuels.

Onwards and upwards Sonangol has acquired an interest in Escom, the dynamic property, construction, oil and mining company. The Angolan oil giant purchased the stake in Escom from Portugal’s Grupo Espírito Santo (GES), one of the largest private investors in Angola.

Escom is involved in an ambitious building project alongside its existing 25-floor iconic building, Luanda’s tallest, which dominates the city skyline and overlooks Kinaxixi Square and the Miramar district. Escom’s project involves constructing three more tower blocks of a similar height.

SonAir spreads wings

Brazuk Ltd

Sonangol’s aviation arm SonAir has obtained certification to operate as an airline in Angola from local licensing authority, National Institute of Civil Aviation (INAVIC). SonAir can now operate anywhere in Angola and is only the second company to gain the licence, after national airline TAAG. MARCH 2011 37

35th ANNIVERSARY

Off-road motor race celebrates Sonangol anniversary 38 SONANGOL UNIVERSO

Global events mark birthday bash

S

Quimbaya

Sonangol staff around the world joined together on February 25 to celebrate the company’s 35th anniversary

onangol subsidiaries and departments across four continents held celebratory anniversary events ranging from sports competitions to gala lunches.

In Luanda, after the formal announcement of company results and the presentation of a $50,000 cheque to the winner of the 2011 Sonangol Literature Prize, more than 5,000 staff members enjoyed a lunch at the Talatona Cultural Centre.

Managing director o Sonangol’s London operations, José Paiva, hosted a lunch for staff where traditional Angolan food was served. Later, guests were treated to theatrical and musical performances by artists from Angola and São Tomé and Príncipe, as well as a show of capoeira, the Angolan/Brazilian martial art.

Back in Luanda, more than 120 people took part in a race from Ponto Final on the Ilha, the long sand spit which shelters Luanda harbour, up to the front of Sonangol’s headquarters on Rainha Ginga Street.

The winner of the men’s race was Alexandre João from Interclube who completed the course in 25 minutes 58 seconds.

He was followed by teammates Domingos Muholo (26 min 15 sec) and Lourenço António (26 min 18 sec).

The women’s event was won by Joana Baptista, a member of Clube Ara da Gabela from Kwanza Sul, with a time of 34 minutes

Sonangol Asia toasts the company’s birthday

MARCH 2011 39

35th ANNIVERSARY

Sonangol celebratory road race

London parties

40 SONANGOL UNIVERSO

Quimbaya

At Sonangol USA, they blow out the candles

“For 35 years our present for Angola is a better future”

55 seconds. Madalena Domingos from Primeiro de Agosto was runner-up clocking 36 minutes 53 seconds, and Isabel Vicente, from Cafanda FC do Bengo came third with a time of 38 minutes 15 seconds.

In the staff race (which followed a shorter route from the naval base to Ponto Final on Ilha), Tomás Faria and Adelino Marcelo (both from logistics) took the top spots. Meanwhile, Rosa Mingas from the finance directorate won the women’s race for the second year running, with Domingas de Miranda (refining) and Antónia Silva (P&P) coming second and third.

During his presentation of the company’s results, president Manuel Vicente stressed that Sonangol has an important social responsibility to the country. This was highlighted by a visit to patients at Luanda’s Psychiatric Hospital to make a donation of various educational materials and foodstuffs.

Antónia de Sousa, the hospital’s director, thanked Sonangol for its donation and said it would greatly help the 322 patients in its care. She said many of those it looked after were from low-income families who were unable to provide their sick relatives with financial support. �

A Sonangol birthday present to a home for the elderly

MARCH 2011 41

35th ANNIVERSARY

The challenges Mateus de Brito

Manuel Vicente: “All of us here today feel very proud for having taken part in all that we have achieved,” said Manuel Vicente. “Going forward, the biggest challenge will be to maintain the standards we have reached and to go on to even greater achievements. We have completed the vision cycle up to 2010 and now we have set out our vision for 2015. Our challenge is to achieve those targets.”

“Sonangol has achieved a lot, particularly in its human resources, increased production and stronger organisation,” said Mateus de Brito. “As far as the challenges ahead are concerned, we have to maintain this performance and do much better.

Sonangol also has a big international portfolio. Right now, we are drilling our first well in Brazil. We are also present in the United States and at two fields in Iraq. We hope that we will start to see some results from these at the end of this year in order to begin production by 2015/2016.”

Fernando Roberto

All photographs by Kamene Traca

“Our job is to do the best for employees, the company and the country and I, like all the members of the board of Sonangol, am very satisfied with our achievements at this 35th anniversary,” said Fernando Roberto.

“I have worked for Sonangol since 1978 and I am very satisfied with the company’s developments. Now we are entering into a new era and I believe that the big challenge will be to improve our competence and human resources in exploration and development and in our management of the new refinery and natural gas.”

42 SONANGOL UNIVERSO

ahead

Sonangol president Manuel Vicente expressed pride in the company’s achievements on its 35th anniversary and confidence in meeting the targets for 2015. Board members also spoke of their hopes for the future.

Gaspar Martins “We all feel proud of being part of a company that has been contributing to the development of this country all this time,” said Gaspar Martins.

“In terms of challenges, the first is to comply with the new vision for 2015, but also to maintain this current level of achievement and maybe increase it. We are moving from a company that was previously only involved in oil, into oil and gas, and maybe in the future into other forms of energy. It is also important to maintain the credibility of the company, especially as we are now going to operate outside Angola.”

Francisco de Lemos “To have a company worth close to $25 billion, to grow within the oil and gas value chain, and to have preserved the company’s status are the biggest achievements that we have made so far,” said Francisco de Lemos.

“The challenge is to become a major national oil company.

The world is globalised; no one can work alone, no country can be alone. So we, as you can see, are redirecting our strategy and moving towards more overseas projects.

As many companies come into Angola, we will try to conquer our own space overseas. That will be our challenge for the next 20 years.”

Baptista Sumbe “In the last 35 years the first great achievement was the increase in oil production. In fact, we went from producing 300,000 barrels per day – when I started working for the company – to close to two million barrels nowadays,” said Baptista Sumbe.

“Also, we have the internationalisation of Sonangol. Going beyond crude oil, we are also in the trading side worldwide. We are in America, in Europe and in the Far East, which is a great achievement.”

Another big achievement, he said, was the segregation of the core business of Sonangol into different business units so that results can be maximised.

“We have also seen a big increase in our contributions to the country.

Our partnership with the government has been boosted so that we can contribute more to the development of the country, helping to reduce poverty and overall improve the living conditions of Angolan people.

“The biggest challenge will be human resources. We need to invest more in training people. The company has grown very quickly in a short space of time, and when you consider that it takes around 15 years to train a good technician, we’ve not had time to catch up yet.”

Anabela Fonseca “I have been in Sonangol for 14 years now and have seen incredible growth in that time,” said Anabela Fonseca.

“I came from the Ministry of Petroleum, and I feel I have grown up myself inside Sonangol. In terms of perspectives or the future, they are amazing. The refining project and the trading subsidiaries are two things under my supervision that I would really like to put in place in the next four to five years.”

MARCH 2011 43

35th ANNIVERSARY

Sonangol’s solid showing in 2010

Manuel Vicente, Sonangol’s board president, announced another successful year’s performance with profits topping $3 billion, a fitting way to mark the company’s 35th anniversary on February 25

T

oday is a special day. We have been in existence for 35 years, which is a milestone along our great journey. Today we seek to clarify the company’s achievements over the last year,” Manuel Vicente told Sonangol’s annual press conference.

In terms of operational performance, he said, Angola produced a total of 640,628,590 barrels of oil, representing an average daily national output of 1,755,146 barrels. As part of that amount, Sonangol produced 314,239,197 barrels.

Vicente said that last year the average price of a barrel of oil was $77.90.

Angola’s liquefied petroleum gas output totalled around 6.89 million barrels, of which Sonangol produced approximately 2.86 million barrels.

The company also produced 1.481 million tonnes of refined products and imported over 3 million tonnes, he revealed.

Ups and downs Vicente noted that Angolan oil production last year fell compared to 2009, with crude oil output declining 3 per cent and natural gas falling 8 per cent. “But in terms of the revenues we are expecting, there will be no reduction [in 2010] thanks to rises in the price of a barrel that we experienced,” he said.

44 SONANGOL UNIVERSO

Output of refined products also saw a reduction of 20 per cent, in spite of the sale of refined products rising 4 per cent as a result of the 10 per cent increase in imports over the past year.

“In terms of financial indicators, we registered sales worth $21.9 billion and had an EBITDA [earnings before interest, taxes, depreciation and amortisation] of $3.88 billion, and we are hoping to have a net profit of approximately $3 billion,” said Vicente.

“I would like to repeat that these are provisional results which have not yet been audited,” he cautioned. In spite of the impact of the world financial crisis, Sonangol, retained its financial record, saw a rise in profits and registered a moderate level of debt, he said.

Rates of return grew moderately in relation to the previous year, remaining in double digits. “We have recorded in these preliminary results asset returns of 11.26 per cent and returns on our own capital of 20.63 per cent, and invested capital returns of 15.41 per cent,” said Vicente.

“Another obligation of the company is its responsibility to the state.

The total amount made over to the state was $8.3 billion, of which $1.7 billion was in oil taxes, and around $6.6 billion from concession-holder revenues,” he added.

In spite of the impact of the world financial crisis, Sonangol, retained its financial record, saw a rise in profits and registered a moderate level of debt SONANGOL 2010 KEY NUMBERS* $3 billion net profits $21.9 billion sales $77.90 average oil price $8.6 billion payments to state 1.75+ million barrels average daily oil output (Angola) 640.6 million barrels – annual total oil output (Angola) 314.2 million barrels – Sonangol’s part of total output * Provisional data. Source: Sonangol

Manuel Vicente outlines the figures for 2010 MARCH 2011 45

35th ANNIVERSARY

Face to face with the press

Sonangol’s board members fielded a series of questions from journalists on subjects including human resources, oil production, refining and international investments.

The first were taken by president Manuel Vicente tuguese debt. But we are in the market. If it were a good deal, then we would buy it, but there is no direct intention just now to buy Portuguese debt.

There has been some talk about a partnership with PetroSA, especially in relation to the new refinery in Lobito. Can you clarify this?

There have been conversations between the two companies and we have signed various memoranda of understanding. There have been contacts, yes, and ideas exchanged, but there are no concrete negotiations with PetroSA. Are there any plans to reduce fuel subsidies again in 2011 and therefore increase the price?

There are concerns about the lack of qualified Angolan engineers in the country – do you share these concerns and what is your proposal for resolving the problem?

We congratulate the Order of Engineers for raising this issue. This is a reality we experience day in, day out, and we often find ourselves asking why our society is producing only lawyers and economists and not engineers. We are already implementing measures to try to overcome this. At a company level we are creating several programmes to accelerate a resolution to this anxiety.

46 SONANGOL UNIVERSO

These days it is not just a problem unique to Angola; it is a problem the world over, as large numbers of young people are not studying mathematics and sciences.

What we need to do is to set up programmes to raise awareness and encourage our young people to embrace maths and physics. We share the sentiment of the Order of Engineers and we would like to work with them to address this gap.

Is Sonangol buying any Portuguese debt?

No, Sonangol has never bought any Por-

“

A big crisis in the Middle East overall brings negatives for the whole world. When you have political stability, there are better consequences

TRAINS

Members of the board meet the press

This is something that is up to the executive [the state]. We would actually like the market price to increase, but, as you know, where petrol and diesel are concerned, there is a fixed-price system. Last year, the executive decided to reduce the subsidies by 20 per cent. We are going to lobby to reduce this further, but the decision remains with the executive. If I were making the decision, I would do it right away, even today.

Is it true that Sonangol is going to explore for diamonds in Zimbabwe?

Sonangol is not exploring for diamonds in Zimbabwe. But Sonangol has an association, a joint venture, with a Chinese company called China Sonangol, and it does have diamond concessions in Zimbabwe.

How do you think the Middle East crisis will affect the oil industry?

Yesterday the market closed at $114 for a barrel of Brent Crude, and I saw a scenario on a television news channel predicting a barrel price rising to $220. I don’t know if this is good for anyone. It must be said, however, that at this moment there are gains to be had, of course, but it is also a moment for reflection and it must be a permanent reflection. We don’t know when this will stop. A big crisis in the Middle East I be-

lieve overall brings negatives for the whole world. When you have political stability, there are better consequences. We hope that the worst scenario does not happen, but on the other hand there are some gains to be had and there’s no doubt about that.

Can you tell us more about the proposals for an Angolan sovereign wealth fund?

This is something that is being led by the executive; it’s not for Sonangol to create a sovereign wealth fund. This is for the state to do. As you know, there is a commission that is working on this and one of our colleagues, Dr de Lemos, is part of this commission. This week the executive created a fund for electricity, but when it is going to create this oil fund I don’t know. It is a decision for the executive, not for Sonangol.

What are Sonangol’s plans in terms of diversification?

This company has a boss; that boss is the state, which has an executive, and we are here to serve the boss of the company. The company has firstly a social objective. It’s not up to me to analyse what we can do or what we cannot do. If the powers say “do it”, then I do it because I have to. If I don’t do it, then it is time for me to leave and I should

start writing my resignation letter.

The state has its concerns and priorities. An example of this is the national housing programme. The government believes the critical mass is here within Sonangol to develop this programme, so it has called upon us to put this in motion.

Questions to Francisco de Lemos Can you give details about Sonangol’s investments?

At this moment, Sonangol has total shareholdings worth around $20 billion. A substantial part of these investments are of a varied nature and more than half are held in its subsidiaries. These investments, excluding those in the oil sector, are made up of several components: some dividends, some financing and some income from loans etc. Overall these investments have brought in close to $650 million.

In Portugal, our principal investments are in Millennium BCP and in Galp. In Galp, it is an indirect investment but in Millennium the investment is direct. Last year, dividends from Millennium were 15 cents per share in the first quarter and, if I am not mistaken, closer to 19 cents during the second quarter. For that reason we had a substantial increase of investment income MARCH 2011 47

35th ANNIVERSARY

tion is supported by imported refined products – that is why we are continuing with the Sonaref project to construct a refinery in Lobito.

This is quite a large investment and in order to recruit some partners into the scheme we have slowed things down slightly. We also needed to look again at the basic engineering and to revise some costs involved. But the project still continues.

We believe that by May – if the programme we have set out is achieved – the plans will go again to the Ministerial Council to be updated, and then we can start building work. The revision is aimed at reducing the costs involved in the project.

Questions to Gaspar Martins from Millennium BCP, exclusively through the distribution of dividends.

Galp achieved profits of approximately €250 million and has an average rate of dividends of 50 per cent. These are very longterm investments, so to know their final value one needs to know the accumulated dividends, which will be calculated at the end of the year. In the case of GALP, when the investment was made five years ago the price of buying a share was around 4 cents.

Now each share is worth 15 cents, so you can imagine the size of the financial potential if Sonangol decided to sell its stake.

Sonangol has created a new subsidiary to manage real estate – can you give more details about this group and its functions?

Sonip was set up in 2009 as a result of the spring cleaning we carried out in the company. We decided that the segmentation of our assets and real estate could be directed differently to overcome deficiencies and make improvements in their management.

As you know, the housing problem is a national one and Sonangol, which employs close to 5,000 members of staff, was also looking for a way to find solutions. In 2001/2 the housing co-operative Cajueiro was set up. Sonangol needed to meet its obligations to find a solution to the housing problem and Sonip was set up primarily based on these two fundamental ideas.

In May last year, the executive took the 48 SONANGOL UNIVERSO

decision to mandate Sonangol to develop a substantial part of the national housing programme. At this point it became necessary for a total restructuring of Sonip for it to be prepared to manage the responsibility of building 130,000 homes around the country, including those for Sonangol employees.

It is a big challenge and, as our president Manuel Vicente has already said, it is feasible to get it done within the deadlines set. The only difference is that we need to work harder and we need more resources because the allocation we have at the moment is not enough to ensure good delivery.

What is the value of Sonangol’s liabilities?

Sonangol has liabilities amounting to $11 billion. This is made up of short-term treasury bonds worth slightly over $4 billion, and also long-term banking bonds that have an average term of six years. These long-term debts are worth approximately $7.4 billion. Our short-term liabilities are the bonds that mature within a year and are made up essentially of our tax obligations on the sales made during the month of December and in the first half of January.

Questions to Anabela Fonseca What is the situation with the planned refinery in Lobito?

More than two-thirds of internal consump-

India’s Oil and Natural Gas Corporation (ONGC) has expressed interest in buying Exxon Mobil’s stake in Block 31 – can you give more details about this?

Several companies have shareholding stakes in Block 31, including Exxon Mobil, but no decision has been taken about whether these companies will stay as they are, and Sonangol can use its right of refusal on the block and keep the existing shareholder structure.

It is clear that India could be interested and we need to make a decision to see what advantages there could be. If it were just a case of attributing the share to ONGC, then it should be attributed, but there are pros and cons.

When will there be a new bidding round for oil blocks?

On January 24 we made the announcement about the bidding for subsalt and offered 11 blocks for exploration. This process is at the stage of final negotiations. I believe that by the end of 2011 we will have all the contractor groups set up, with the possibility to start exploration of this new geological level which has been so productive in Brazil. We believe that with the similarities that exist between Brazil and Angola, we will also have positive results. The preliminary work has been done; we are now just waiting to begin the exploration work.

What is the situation with Block 18

where there have recently been some production problems?

This question is about the FPSO [floating production, storage and offloading vessel] Great Plutonio in Block 18. This FPSO has had operational problems that are quite considerable. We have been working with the operator to find ways to minimise the problems in order to guarantee that operations continue. At this moment it is producing at less than 50 per cent of capacity.

Repair work is ongoing and we believe these problems will be resolved. It will close in April, which is part of the planned phase of repairs, to enable us, by May or June, to get back to the production levels that the operator BP said it would deliver.

Prize money to launch cultural foundation

Questions to Mateus de Brito

The winner of the twelfth Sonangol Literature Prize was guest of honour at the 35th anniversary celebrations in Luanda

Sonangol has plans to internationalise its portfolio. Can you tell us about that?

I would like to start with Cuba where we have signed a contract with Cupet to explore and develop two blocks in the Exclusive Economic Zone. They are the blocks N23 and N33. We are going to begin our seismic activities at the end of April.

Regarding Venezuela, a tripartite contract has also been signed between Sonangol, Cupet and PDVSA to develop and produce in two fields, Miga and Melones.

These will deliver 20,000 barrels of oil a day over a period of five years, and will have a final total production volume of 94 million barrels.

Regarding Iraq, we have a contract to develop and produce in two fields, Qayara and Najmah. We are currently in the procurement phase and also doing some seismic surveys and constructing a logistics base. We think that by the end of the year we will have some results from these fields.

I would like to take this opportunity to say that we are also in Brazil. We are currently drilling and prospecting in the Campos Basin and also prospecting in the Santos Basin. In addition, we also have a stake in the Gulf of Mexico. The only African company with operations in the United States. We have 11 concessions there and we are currently waiting for the licence to start drilling and to be able to prospect.

Cape Verdean writer and historian João Lopes Filho, winner of this year’s Sonangol Literature Prize, was presented with a $50,000 cheque by board member Anabela Fonseca during the company’s anniversary commemorations.

After thanking Sonangol for its support for literature, Lopes Filho announced that he would be using the prize money to set up a foundation to promote culture and philanthropy in his native Cape Verde. Later, he signed copies of his book Percursos & Destinos (Routes and Destinations), written under the pseudonym Osagyeto Moisés, which tells the story of the journey of Cape Verdean cultural and social development.

The Sonangol literature competition has been held a dozen times since its creation in 1987. This year was the first time writers from other Portuguese-speaking African countries were invited to take part, prompting submissions from Cape Verde, Mozambique, São Tomé and Príncipe, and Guinea-Bissau.

Honourable mentions went to Laço de Aço Lasso (Tie Steel Lasso), by Angolan writer Jordão Augusto Trajano, and Filho do Planalto (Son of the

Plateau), by Marcelo Panguana from Mozambique.

The judging panel was made up of Corsino António Fortes and Cornélio Caley from Sonangol, Manuel Muanza from the Angolan Union of Writers, Frederico Gustavo dos Anjos from São Tomé and Princípe, Francisco Conduto de Pinapela from Guinea-Bissau, Carlos Paradona from Mozambique, and António Fernandes da Costa on behalf of the Angolan Ministry of Culture.

Praising Sonangol for the initiative, the panel said the prize was an “incentive for aesthetic creation and scientific production, as well as an exchange of experiences” between the cultures of the countries taking part.

MARCH 2011 49

Cuba

USA Sonangol USA is responsible for marketing and commercialisation of Sonangol’s oil and gas in the United States.

Sonangol P&P is starting exploration in Cuba in two blocks, and hopes to start technical activity, principally seismic studies, by the end of April 2011.

Houston Gulf of Mexico

Cape Verde

Havana

Sonangol Cabo Verde

Cape Verde

Gulf of Mexico Sonangol P&P, the first African oil company to be operating in the Gulf of Mexico, is working with Cobalt Energy and Total.

São Tomé and Príncipe Sonangol São Tomé and Príncipe is currently working to develop the islands’ airport and port.

Rio

Brazil Sonangol plans to invest $1 billion in the next two years, working with Brazilian operator Starfish.

50 SONANGOL UNIVERSO

SONANGOL:

THE GLOBAL PICTURE UK Sonangol UK is responsible for marketing and commercialisation of Sonangol’s oil and gas in the UK.

London

Portugal Lisbon

Sonangol has invested in companies here including Millennium BCP and Amorim Energia.

Iraq

Iraq Sonangol bought exploration rights for the Qayara and Najmah fields in northern Iraq in December 2009 and says it has received many offers from international companies for development of the sites.

São Tomé Soyo Offshore

Hong Kong

Hong Kong China Sonangol engages in oil, gas and minerals investment and exploration, crude oil trading and large-scale national reconstruction projects.

With the headquarter office in Hong Kong, the company also has branch offices in China, Africa and Latin America.

Singapore

Luanda Lobito

Singapore Sonangol Asia is responsible for marketing and commercialisation of Sonangol’s oil and gas in the Asian market.

Angola

Luanda – Sonangol headquarters. Base for Sonangol P&P, SonAir, Sonangol Logistica, Sonangol Distribuidora, Sonangol Shipping, Sonangol Investimentos Industriais Lda, Sonip, MSTelcom and Essa.

Soyo: Sonagás is involved with the Angola LNG project.

Lobito: Sonaref is developing a new refinery.

Offshore: Sonangol P&P has concessions and operational interests in various production and exploration blocks onshore and offshore and in deepwater and ultra deepwater.

MARCH 2011 51