March 29 (Bloomberg) -- Angola passed Saudi Arabia to become China's top oil supplier in February as the world's fourth-largest economy turned to Africa to meet rising demand.

Angola shipped 456,000 barrels a day to China in the first two months of the year, according to Petromatrix GmbH, a Swiss risk management company. That's 15 percent of China's imports and more than Saudi Arabia and Iran, OPEC's top two exporters, supplied. West African producers Congo and Equatorial Guinea are among China's ten largest oil sources.

China's trade with Africa has tripled since 2002 as it seeks access to oil and other resources to feed economic growth that's running at almost 10 percent a year. China Petroleum & Chemical Corp., or Sinopec, agreed last week to help build a $3 billion refinery in Angola. In January, Cnooc Ltd. agreed to pay $2.27 billion for a stake in a Nigerian oil field.

``Angola and other African countries are attractive to China because they're ramping up production and their crudes are pretty good quality,'' said Tony Regan, director and lead consultant at energy adviser Tri-Zen in Singapore. ``Angola is a new, big and serious player.''

China, where oil imports have tripled in five years, has agreed to lend Angola $3 billion and develop deepwater reserves as it competes with the U.S. for West African oil. San Ramon, California-based Chevron Corp. is the largest producer in Angola, which may almost double output to 2 million barrels a day in the next three years.

Car, Trucks

Oil imports to China rose 34 percent to 179 million barrels in the first two months of the year from the same period in 2005, according to customs data. Demand is rising as the country's automakers sell more than 500,000 cars, buses and trucks a month. Asian oil imports increased 15 percent in January and February from a year earlier, Zug, Switzerland-based Petromatrix said.

Production in Angola, sub-Saharan Africa's second-largest exporter behind Nigeria, may reach 2 million barrels a day by 2008 from 1.25 million in 2005 as new fields come on stream, according to a U.S. Energy Information Administration January report. Two-thirds of the Angolan population is sustained by agriculture and lives on less than $1 a day, the report said.

The country's proven oil reserves have tripled in the last seven years, as BP Plc, Chevron and other companies have found oil in the seabed off the country's Atlantic coast. Angolan and other West African crudes are so called ``sweet'' grades of oil, prized by refiners for their low-sulfur content, making them easier to process into gasoline.

Block 18

Sinopec has borrowed $1.5 billion to develop its 50 percent stake in Angola's Block 18 offshore oil field. BP Plc, Europe's largest oil company, has the other 50 percent.

Cabinda, Angola's leading crude grade traded yesterday at $62.73, a $2.05 discount to dated Brent crude oil in London, according to data compiled by Bloomberg. Cabinda has risen relative to Brent, a benchmark for European traders, since the start of the year, when it traded at a discount of almost $4.

``China's refineries were designed to run their own crudes, which are basically sweet in quality,'' said Ong Eng Tong, a consultant to Hamburg-based oil trader Mabanaft International GmbH. ``Hence, it would be more prudent, all things being equal, to take crude from Angola than Saudi.''

Angola, where 27 years of civil war ended in 2002, is a former Portuguese colony of 11 million people. Oil production accounts for 45 percent of the country's $24 billion economy, a Central Intelligence Agency report said. Angola is the world's fifth-largest diamond miner, according to De Beers.

Iran, Congo

Saudi Arabia, the leading member of the Organization of Petroleum Exporting Countries, shipped 445,000 barrels of oil a day to China in the first two months of the year, followed by Iran's 391,000. Congo supplied 140,000 barrels and Equatorial Guinea 133,000 barrels a day.

Nigeria, Africa's largest oil producer and the fifth- largest supplier to the U.S., doesn't feature among the thirty oil suppliers to China on Petromatrix's list.

China agreed to add $1 billion to an existing $2 billion loan backed by oil it agreed to grant to Angola, Reuters reported yesterday, citing a person it didn't name.

Chinese trade with Africa totaled $32.2 billion in the first ten months of 2005, according to the New York-based Council on Foreign Relations.

China's investments in West African fields may boost oil tanker demand as more cargoes are shipped to refineries in Asia, shipbroker E.A. Gibson Ltd. said last month.

Oil is shipped from West Africa to China in so-called very large crude carriers, tankers able to carry 2 million barrels of oil. The voyage around the Cape of Good Hope and across the Indian Ocean is almost twice as long as the journey from the Middle East to China, tying up ships for longer.

To contact the reporter on this story: Will Kennedy in Singapore at wkennedy3@bloomberg.net.

Last Updated: March 29, 2006 03:08 EST