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ANGOLA - Energy & Mining

Carlos Amaral

CEO, ACREP

Bio

Carlos Amaral has been in charge of ACREP as Managing Director since its establishment in 2003. He has worked as a mining engineer since 1975, started his career in the oil and gas industry at Petrofina (1975-1980) and successively at Sonangol as Production & Reservoir Engineer (1980-1985) and at Oil & Energy Ministry as Technical Cabinet Manager (1985-1991). Before establishing ACREP in 2003, Mr. Amaral was a Consultant to Oil & Gas companies such as Sonangol E&P Angola (1992-1994) and Norsk Hydro Angola, a Norwegian oil company now Equinor (1995-2001).

"We launched the company in 2003 with the goal to develop and promote onshore fields that had been abandoned or closed."
TBY talks to Carlos Amaral, CEO of ACREP, about the company’s operations, the Cabinda Sul development, and goals for the medium term.
Could you provide insights into the company’s operations in Angola?

We launched the company in 2003 with the goal to develop and promote onshore fields that had been abandoned or closed. In 2005, we joined an offshore block from which in 2009 ACREP had its first export. Subsequently, we joined another four blocks and participated in the first licensing round in Angola in 2006, taking ACREP to sign a PSA whose operator was Total. Later we also entered onshore in Cabinda North Block operated by Sonangol P&P, where we have a presence to date. In 2016, we joined Block 2/05, which helped ACREP increase production. We became an operator in Namibia onshore, along the border with Angola, where we remained for five years. More recently in 2020, the company joined a contractor group composed of three majors: Equinor, Sonangol P&P, and ENI (now Azule Energy). Our actual portfolio comprises five blocks, with two onshore and three offshore.

ACREP recently acquired a stake in Cabinda Sul. What motivated this strategic move, and what opportunities does it present for ACREP?

Instead of participating in the licensing round for onshore blocks, ACREP decided to acquire a small operation to prospect roll and bought a 55% stake participating interests plus the rights to operate the block. Since we do participate in another onshore block in Cabinda and decided to become a strong onshore operator, our strategy focus on concentrating our assets in Cabinda, the oldest known producing area in Angola offshore. We believe we are in the right spot. Onshore projects in Angola are still at a nascent stage and have yet to be exploited or explored. That is the challenge with local companies that become operators—taking on onshore projects.

How does ACREP align its operations with the country’s energy goals and contribute to the development of the upstream sector?

We currently produce and sell around 3,000 bpd. However, we recently sold our best asset, block 2/05 , as we are concentrating on our efforts on the exploration program of block 1/14, operated by Azul Energy, where the first exploration well will be drilled in 2024. It has significant potential, with a mix of oil and gas. If it is gas, it will allow Angola to produce a cleaner or carbon-neutral energy, which is where the world is headed toward currently. In terms of our onshore Cabinda assets, we will not only operate the remaining small fields of Cabinda south but will also develop a small gas field and produce electricity. We call it a social project, because by producing electricity via gas, we are improving people’s lives. In Angola, similar to other countries in this part of the world, a normal home uses about 300kWh of electricity compared to 8,000 in Europe and 12,000 in the US. Even if there are small gas reserves, we should work on them to transform energy and electricity generation locally. If the project turns to be a feasible one, we can always expand on a bigger scale, by making a pilot project through the actual Cabinda onshore and a small production.

With ACREP starting to publish its annual sustainability report, what is the company’s commitment to sustainability in Angola?

In the last 19 years, even without being operator, we have always had a commitment to the community, sustainability, and the social part of our work. For that purpose, ACREP has built with its own funds two schools near Luanda which teach 1,000 students. Since 2012, we have supplied breakfast to students, and that has been our main social project. Sustainability wise, in one of the schools we have drilled a water well that produces salt water that is desalinated through solar energy. Supporting the water wells in these two schools cost us about USD5 million, and this demonstrates how we have been investing in the country and not just on exploration. In Mussulo, we also have a school for less than 10 year olds that has electricity 24 hours a day, running water, computers, internet, and more, power by a 35 KW solar powered system..

Can you elaborate on the Cabinda North project?

That is an interesting project, even if up today has always been in the exploration phase. As said we did acquire the Cabinda South operation from Pluspetrol, whose current produces rounds the 400 barrels per day. It is not a large amount, though we are buying an operation rather than a project. The idea is to integrate with the Cabinda north, where ACREP SA aims to increase its 12,82% working interests through the acquisition of the actual operator, Azule Energy, participative share. In Cabinda, being a local oil company, it should maximize attendance to the people’s needs, which include providing access to electricity in their homes.

What are your goals for the end of this year and the company’s plans in the medium term?

Sustainability-wise, in ESG, we have two major plans. Our shareholders including BPC a state Bank, have decided to divest their assets, and by decision the government has agreed to sell its stake in ACREP to raise capital. A decision was made for ACREP to list on the local stock exchange, Bodiva, since the government wants to have the first local oil company in the game. The plan is to go public in October 2023. It is still unclear if we will block shares for larger entities or if we will go completely public and allow everyone become a shareholder of ACREP.

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