Angola’s President João Lourenço has approved a special legal regime aimed at maximizing hydrocarbon recovery in mature oil concessions within the country’s maritime zone.
This initiative, announced in a presidential decree dated November 20, focuses on promoting incremental production in aging fields through enhanced investment opportunities.
The regime targets fields that have been operational for over 25 years or have utilized 70% or more of their proven reserves, as defined by the National Oil, Gas, and Biofuels Agency (ANPG). It encourages redevelopment activities in these blocks to increase oil output efficiently.
The decree ensures cost recovery for investors in cases of unsuccessful drilling and introduces tax incentives to encourage production. Key measures include:
- Tax on Oil Production: Reduced to 15% for incremental production under association contracts, effective the month after the first activity in the General Development and Production Plan.
- Oil Income Tax: Set at 25% under production-sharing contracts, with incentives applicable after the first development activity.
These provisions aim to attract investments by offering tax relief compared to the standard legal framework outlined in the Petroleum Activities Tax Law.
The decree mandates that ANPG, Angola’s national concessionaire, is allocated annual financial resources to manage the costs and duties associated with boosting production in mature fields.
Angola’s Minister of Mineral Resources, Oil, and Gas, Diamantino Azevedo, highlighted that investments in active oil concessions totaled $47 billion between 2018 and 2022.
This figure is projected to rise to over $72 billion from 2023 to 2027, reflecting Angola’s commitment to revitalizing its oil sector.
This special regime aligns with the government’s efforts to sustain and enhance oil production in mature fields, reinforcing Angola’s position as a key player in the global energy market.
