Angola: Offshore exploration invigorated by the country's recent budgetary response.

Angola's recent fiscal response, coupled with a thorough reform of the fiscal environment for its oil and gas sector since President Lourenço came to power in 2017, is giving new impetus to offshore exploration in the country. The sector, which boomed after 11 blocks were awarded in the 2011 pre-selection tender, is gradually regaining momentum after a difficult period marked by falling oil prices between 2014 and 2019.

Recent tax incentives introduced by the Angolan government have rekindled supermajors' interest in high-risk, deepwater projects. While the incentive to develop infrastructure, the revival of marginal fields and the expansion of non-associated gas projects are evidence of the successes achieved, the most striking development is reflected in the revival of the offshore exploration licence landscape seen over the last six years.

The example of the well Arcturus 1 ExxonMobil's project in the Namibe frontier basin, although ultimately dry, illustrates the new dynamic of exploration in highly technical areas. At the same time, last November Shell began its comeback in Angola by signing a memorandum of understanding to study the hydrocarbon potential of blocks 19, 34, 35, 36, 37 and 43. These initiatives come against a backdrop in which, despite a number of setbacks, the country continues to offer numerous opportunities, particularly in the north, where many deepwater blocks remain unexplored.

In the Bas-Congo basin, the recent award of blocks 46 and 47 operated by Azule Energy, as well as blocks 49 and 50 by Chevron, prompted TGS to carry out new 3D seismic acquisitions. The well Kianda 1 NFW d'Azule, planned for Block 47 in 2025, symbolises the renewed confidence in the potential of this ultra-deepwater region.

The Angolan government is also planning to launch a limited public tender for nine offshore blocks in the Kwanza and Benguela basins in the first quarter of 2025. However, the ongoing evaluation by the majors of four of the proposed blocks could lead to delays or to the selection of alternative acreage, underlining the need for caution in a phase of transition and adjustment.

Angola's fiscal response and tax incentives are redefining the offshore exploration landscape, positioning the country once again as a strategic investment area for the major oil companies. Despite some technical setbacks, the current momentum points to a significant resurgence in deepwater activity, a sign of a promising future for Angola's energy sector.