Oil auctions to boost Angola transparency

LUANDA – Angola has said that its bubbling oil sector was poised to rake in US$1,6 billion in new investment after auctions it says highlight a new commitment to transparency.

The government of sub-Saharan Africa’s second biggest oil producer has been accused in the past by western donors and human rights groups of graft on a grand scale. Scant oil money has trickled down to most of Angola’s 13 million people who live in poverty.The US$1,6 billion is from successful bids for many of the country’s lucrative offshore blocks announced on Tuesday in the Angolan capital Luanda by state oil company Sonangol at the end of a public auction – the first of its kind where government signature bonuses have previously been secret.Asked whether Sonangol was trying to make the hitherto confidential bidding process more transparent, Cristina Novaes, a spokeswoman for Sonangol said: “Yes, that’s the idea.”Victoria Costa, another Sonangol spokeswoman, added: “We have these (new) procedures so we can be transparent and show the people our calculations so they can’t later say that the government is secretive.”Topping the list of big investors was Italian oil giant ENI which bought a 35 per cent operating stake in a relinquished part of Block 15 for a combined investment of over US$1,2 billion including a signature bonus of US$902 million.The offer trumped the Angola-China joint venture Sonangol-Sinopec International whose proposed signature bonus of US$750 million, from a total investment of US$982 million, garnered a modest 20 per cent stake.Other successful bidders included Prodoil, which bid US$207,9 million for Block 1, Interoil (US$60,9 million) in Block 5 and Brazil’s Petrobras in both Block 6 (US$88,9 million) and Block 26 (US$37,5 million).Angola pumps 1,4 million barrels per day (bpd) and is on course, with billions of dollars of investments from Western majors such as Exxon Mobil, BP and Chevron, to ratchet up production to 2m bpd by the end of 2007.Some 20 foreign companies spanning Europe, United States, Latin America, China and India, were involved in the bidding.Public scrutiny at an oil auction shows that strides have been made since 2000, when UK based BP revealed an US$111 million signature bonus for Angola’s block 31, provoking Sonangol to threaten to cancel BP’s production sharing agreement.”It’s an extraordinary development …this kind of openness in an area previously private and confidential,” said Bill Cummings, Public Affairs Manager at Esso, a subsidiary of US giant ExxonMobil .Others say it is just a start.- Nampa-ReutersScant oil money has trickled down to most of Angola’s 13 million people who live in poverty.The US$1,6 billion is from successful bids for many of the country’s lucrative offshore blocks announced on Tuesday in the Angolan capital Luanda by state oil company Sonangol at the end of a public auction – the first of its kind where government signature bonuses have previously been secret.Asked whether Sonangol was trying to make the hitherto confidential bidding process more transparent, Cristina Novaes, a spokeswoman for Sonangol said: “Yes, that’s the idea.”Victoria Costa, another Sonangol spokeswoman, added: “We have these (new) procedures so we can be transparent and show the people our calculations so they can’t later say that the government is secretive.”Topping the list of big investors was Italian oil giant ENI which bought a 35 per cent operating stake in a relinquished part of Block 15 for a combined investment of over US$1,2 billion including a signature bonus of US$902 million.The offer trumped the Angola-China joint venture Sonangol-Sinopec International whose proposed signature bonus of US$750 million, from a total investment of US$982 million, garnered a modest 20 per cent stake.Other successful bidders included Prodoil, which bid US$207,9 million for Block 1, Interoil (US$60,9 million) in Block 5 and Brazil’s Petrobras in both Block 6 (US$88,9 million) and Block 26 (US$37,5 million).Angola pumps 1,4 million barrels per day (bpd) and is on course, with billions of dollars of investments from Western majors such as Exxon Mobil, BP and Chevron, to ratchet up production to 2m bpd by the end of 2007.Some 20 foreign companies spanning Europe, United States, Latin America, China and India, were involved in the bidding.Public scrutiny at an oil auction shows that strides have been made since 2000, when UK based BP revealed an US$111 million signature bonus for Angola’s block 31, provoking Sonangol to threaten to cancel BP’s production sharing agreement.”It’s an extraordinary development …this kind of openness in an area previously private and confidential,” said Bill Cummings, Public Affairs Manager at Esso, a subsidiary of US giant ExxonMobil .Others say it is just a start.- Nampa-Reuters