Offshore oil provides stability to Angola

Published November 7, 2003

JOHANNESBURG: It’s on Africa’s anarchic West coast, it’s had almost three decades of civil war, and it’s rated as one of the poorest and most corrupt countries on Earth.

Yet one of Angola’s improbable attractions to oil majors is stability as it puts behind a conflict that, crucially, seldom disrupted its offshore oil production.

Stability and security may well be valued above all else in a region where the largest oil producer, Nigeria, loses tens of thousands of barrels a day to brazen bandits and where ethnic conflict periodically halts the pumps.

The no-nonsense Angolans do not tolerate such nonsense.

“They keep a very tight reign on things in Angola... The war wouldn’t allow for any mistakes with oil,” said Herman van der Linde, a security analyst at Pretoria-based political consultancy Executive Research Associates.

Angola’s savage civil war between the government and UNITA rebels ended last year and the state’s war machine was greased and funded by oil, while diamonds funded the rebel war chest.

Angola is sub-Saharan Africa’s second largest oil producer after Nigeria and with a new crude stream set to launch in December, is expected to double output over the next four years, with the United States a keen customer.

Industry data and analysts’ projections show Angola should be pumping more than two million barrels of oil a day by 2008 — and that oil should flow fairly smoothly.

ANGOLAN STABILITY: No one complains about a drop getting stolen in Angola.

“Angola could face Nigerian-style problems if they found big deposits onshore, but their oil is offshore and can’t really be reached,” said Nicholas Shaxson, associate fellow at The Royal Institute of International Affairs.

Angola does face a smouldering, low-intensity conflict in its oil-rich Cabinda enclave that is sandwiched between the two Congos, but it is no threat to the oil facilities offshore.

Even during the war oil production was mostly steady. In 1993, UNITA overran Soyo in the far northwest of the country and destroyed onshore production facilities including storage tanks and processing plants. But that was hardly the norm.

Security analysts do see looming conflicts over scarce and valuable resources like oil in poor regions like Africa.

But none see anyone seriously challenging the battle-hardened Angolan armed forces, who have intervened militarily in recent years in all of their neighbours — not always officially — and who have about 100,000 men under arms.—Reuters