How can Angola and other petroleum producing countries work towards attracting more investment into local content development in the hydrocarbons sector?
Since the US found successively, shale gas and then tight oil, the global dynamic has changed. Many traditional O&G producers (e.g. Iran, Iraq, Libya, Venezuela) have been challenged. This has implications for Africa, in that country competitiveness (in fiscal and non-fiscal (e.g. local content) matters is crucial. We see local content as part of a virtuous circule whereby a bedrock of extractable resources, is supplemented by adequate fiscal terms and in turn supplemented by a plausible local content policy that aims to create a cost competitive escalator (where the market is able to deliver increasing local content over time).
What strategies does Standard Bank have to further encourage the financing of expansion of SME’s in the petroleum sector across Africa?
Standard Bank is very excited by the long-term potential of indigenous SMEs in the African petroleum sector. We are struck by examples such as the Wood Group, which grew up around North Sea oil and how they became listed companies. To that end, we have formed the ‘’Incubator’’ in Mozambique, which is now being rolled out to Uganda. The aim of the incubator is to provide space, services, advice, mentoring, coaching and support to assist new and growing innovative businesses to become established and profitable or scaleable. No doubt, such businesses will boost local content over time.
What do you think the key outcomes for the ALC 2018 conference should be?
Angola is seen by the world as a country in transition. The change in political leadership has been well-received and now the sector is looking forward to change and innovation in the areas of new exploration, natural gas and marginal fields, among others. We are also encouraged by the deals that have been signed in 2018. We would hope the ALC conference can contribute to the increasingly positive mood within Angolan O&G and a realistic and achievable climate for local content to grow over time and assist the sector’s broadening and diversification