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Vol 2 (AAC) No 11

Published 1st September 2009


Luanda diversifies its portfolio

A weak economy drives Angola into the arms of the IMF as Luanda's elite works more closely with their Chinese counterparts in local and regional deals

China's relations with Angola suffered a setback this month when Luanda turned down the acquisition by China National Offshore Oil Corporation and Sinopec of a coveted oil block. Worse, lower than expected oil revenues have battered the Angolan economy and government officials are scheduled to meet representatives of the World Bank and International Monetary Fund at the end of this month to negotiate a support package. Sonangol, the state-owned oil company, invoked its right of first refusal on 10 September on a 20% share of Block 32 held by United States-based Marathon Oil. China National Offshore Oil Corporation and China Petroleum and Chemical Corporation (Sinopec) were planning to buy the block - a promising investment, boasting 12 oil discoveries and estimated recoverable reserves of 1.5 billion barrels of light crude - in a 50-50 joint venture for US$1.3 bn.

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