The Parliament of Angola has adopted five bills which authorise the President of the Republic to legislate on the deduction of investment premiums on tax on income from oil of blocks 30, 44, 45, 1/14 and the centre of the onshore area of Cabinda, said the National Assembly.
The Minister of Mineral Resources and Oil said that the negotiations for the five legislative authorisations, which fall within exploration activities, increasing stocks, stabilisation of oil production in Angola and the sustainability of the industry, began in January 2019.
Diamantino de Azevedo said that, when contracts have been negotiated, there was no pandemic nor a “situation of high competition in the oil industry worldwide.”
“We are increasingly witnessing the appearance of other oil producing countries which, in many cases, have better geological conditions and infrastructure than ours,” the minister said.
The Minister stressed that three of the five projects are located in the Namibe Basin, a new frontier of exploration, where there are currently 12 blocks in deep waters.
The contracts with risk were negotiated between the National Oil, Natural Gas and Biofuels Agency and Exxon Mobile, for blocks 30, 44 and 45, and Italian oil company ENI, for blocks 1/14 and the centre of the onshore area of Cabinda.
On the occasion, Diamantino de Azevedo also said that, if the Covid-19 pandemic continues, the storage capacity of oil will be used up across the world in the coming weeks.
He said that the current capacity varies between 400 million and 600 million barrels, and in April there excess supply of about 25 million barrels of oil is expected, after OPEC and partners decided to make cuts amounting to 10 million barrels of oil.
“These cuts are not enough to create liquidity between demand and supply, which has led other countries that are not members of the organisation, such as the United States of America, Canada, Norway and Brazil to commit themselves to making cuts of about 9.4 million barrels,” he noted.
Azevedo said that even these two cuts will not lead to the balance required between supply and demand.