Angola Oil Fields Seen Offering More Crude in New Searches

Sonangol EP, Angola’s state-owned oil company, is offering exploration licenses for 10 onshore areas that may offer more crude than previously thought, according to a surveying company that has assessed the deposits.

“The new seismic images show more potential” than a previous survey showed 40 years ago, said Rui Vasconcelos, a geologist at Petroleum Geo-Services ASA, the Norway-based business that made preliminary studies of the concession areas. “We see sediments that correspond to formations” of hydrocarbons, he said today in Luanda, the capital.

Sonangol is offering three blocks in the Lower Congo basin and seven southeast of Luanda. Onshore fields are typically less expensive to tap than deep-water areas such as those where Total SA, Exxon Mobil Corp. and Chevron Corp. pump most of Angola’s 1.7 million barrels a day of output. Angola, Africa’s second-largest crude producer, is urging domestic companies to bid to increase local participation in the oil industry.

The company will explore five of the onshore blocks and hopes to offer them to local bidders for development, Severino Cardozo, director of exploration at Sonangol, said at a media conference today in Luanda. Sonangol will keep an unspecified share in the blocks, four of which are in the Kwanza basin near Luanda and one in the Lower Congo basin in the north, he said.

Sonangol’s exploration of the five blocks and subsequent negotiation could take as long as four years while five other blocks could be awarded by November after bilateral discussions with the bidding oil companies, Cardozo said.

‘Quality’ Reservoir

Sonangol has scheduled investor presentations in Houston and London in the next few weeks to explain how the onshore and offshore regions are part of the same rock basins where Cobalt International Energy Inc. has found what it called the “high-quality” Cameia reservoir beneath a layer of salt several kilometers below the seabed. The same salt structure exists on land, Cardozo said.

“It looks very good,” he said. “We think that oil companies will drill into reservoirs like Cameia.”

Angola is betting its basins mirror the geology off the coast of Brazil, where multibillion-barrel finds have been made. Sonangol is forecasting Angolan output of 2 million barrels a day by next year and about 2.175 million barrels a day by 2018, according to company documents.

PGS helped produce about 3,600 kilometers (2,240 miles) of new geological data on the onshore areas, Vasconcelos said.

“With the new seismic images, we can see below the salt, and we can merge the data with that from exploration wells,” he said. “The technology has revealed visible structures.”

Sonangol has divided the Kwanza basin around Luanda into 23 concessions of 1,000 square kilometers (386 square miles) each. Some of the blocks lie within the 9,960 square-kilometer Kissama National Park, according to company maps.

Before it's here, it's on the Bloomberg Terminal.