Angola’s Sonangol Targets $4.8B Chinese Financing for Lobito Refinery Without Oil-Backed Collateral
Sonangol, Angola’s state oil company, is pursuing a $4.8 billion loan from Chinese financial institutions to accelerate construction of its new refinery at the Atlantic port of Lobito. This could be Sonangol’s first major borrowing from China in seven years.
Sebastiao Gaspar Martins told reporters on Wednesday that the financing effort is intended to fund the next phase of the $6.2 billion refinery project, designated a national strategic priority.
“The next phase is estimated at $4.8 billion, and we are engaging Chinese institutions with the support of the contractor, who is also Chinese, to secure this financing,” Martins said, according to Reuters.
While specific lenders have not been confirmed, Angola’s Ministry of Finance indicated last month that the China Development Bank could be a potential financier.
Sonangol confirmed that a delegation will travel to Beijing in April to advance negotiations. Notably, the company emphasized that no oil-backed collateral will be required a departure from the resource-backed borrowing model Angola has relied on for nearly two decades.
The refinery is expected to begin producing refined petroleum products by December 2027, a milestone that could significantly reduce Angola’s dependence on fuel imports.
Chinese Lending Pullback and Africa’s Funding Gap
Once Africa’s dominant creditor, China has scaled back lending since 2019, a trend accelerated by the COVID-19 pandemic.
This has left several African megaprojects, including Kenya’s modern rail infrastructure, unfinished.
According to a study by ONE Data, African debt repayments to China now exceed new loans, highlighting tighter credit flows. Still, China maintains that it “stands by” African partners in investment and trade.
Angola’s move away from resource-secured borrowing reflects broader global challenges, including oil price volatility, rising interest rates, and shifting risk perceptions.
Government data shows that Angola’s stock of oil-backed debt to China fell nearly 25% in 2025, declining from $10.146 billion in 2024 to $7.73 billion.
By seeking conventional financing for the Lobito refinery, Sonangol aims to secure critical funding while mitigating reliance on resource-backed debt, positioning Angola to advance its energy infrastructure and reduce fuel import dependency.
