Isabel Spells Danger for Angolan Banks

7 de November de 2016 Rui Verde

When the United States warns of the risks of handing control of Angola’s banks to politically exposed people (i.e. President José Eduardo dos Santos, his family members, and the Generals who back him), this is not an idle warning. It’s because the USA know the President is planning to transfer control over the BFA (Banco de Fomento Angola) to his daughter, Isabel, and that once he does so, the Presidential group’s control over almost the entire Angolan banking system will be in place. How so? According to African Business Magazine’s list of Africa’s Top 100 Banks in 2015, the five largest banks in Angola were: Banco Económico (BE – Economic Bank), Banco Angolano de Investimentos (BAI – Angolan Investment Bank), Banco de Poupança e Crédito (The Savings and Credit Bank), Banco de Fomento de Angola (BFA – Development Bank of Angola) and Banco BIC (BIC – The International Credit Bank). […]

Sonangol “Can’t Even Afford Toilet Paper”

3 de November de 2016 Maka Angola

Employees at the Angolan oil giant have flushed out some startling news about Sonangol’s continued decline. Since President José Eduardo dos Santos put his daughter, Isabel (Africa’s first female billionaire), in charge the oil giant’s fortunes “are in the toilet”. At the company’s headquarters, in a custom luxury US $400 million building, in which over-invoicing reached hallucinatory levels, officials are confronted with a stark reality. Apparently, Angola’s most important enterprise can’t afford to supply its own washrooms. “Every worker has to bring their own toilet paper from home because Sonangol has been unable to pay its suppliers and we have a toilet paper crisis,” one official resignedly told Maka Angola. Staff fear they’ll become the butt of jokes. They say the situation is out of hand. Only the denizens of the 18th, 19th and 20th floors – where Isabel and her coterie of expatriate ‘consultants’ have their dens – are […]

Economy

Oil & Money: Sonangol’s Extravagant Conference in London

13 de October de 2016 Agência Pública

Some of the most powerful players in the global oil and gas industry will be meeting in London on October 18-19, for the Oil & Money annual conference. Hosted jointly by the New York Times and Energy Intelligence, the conference is described as a “must attend” – a gathering of “over 450 of the most influential senior decision-makers from the industry, along with government ministers and representatives, financiers and bankers, consultants and legal experts.” The conference agenda boasts of hours of “effective network opportunities…in a crowd large enough to be powerful, small enough to be intimate.” Tickets for the conference cost £2,490 (544,000 Kz), not including attendance at the Petroleum Executive of the Year Dinner which will set you back an extra £525 (115,000 Kz). Who are the sponsors of this lavish affair? The list of donors includes big-hitters like Chevron, ExxonMobil and Dow Chemical but also a host of […]

The Chevron Ultimatum: Sonangol Has One Week to Save Itself

12 de October de 2016 Rafael Marques de Morais

New management at the Angolan National Oil Company Sonangol has engineered a situation which now threatens the very survival of the company. Since June this year, when Angola’s President José Eduardo dos Santos installed his daughter Isabel dos Santos to chair the board, Sonangol has repeatedly failed to honour its promises to pay some US $300 million owed to the US multinational oil giant Chevron. The sum relates to production costs for the lucrative Block 0 in Angola’s offshore oilfields, which is 40 percent owned by Sonangol and 39.2 percent owned by Chevron. Sources in Houston have told Maka Angola that the US company has exhausted all options for finding an amicable solution, with no reciprocity from Isabel dos Santos’s board. The result is that Chevron Angola’s Director-General John Baltz has now given the Sonangol board an ultimatum: they have one week to come up with a payment plan or […]

Economy

Angolan Oil Greases a Trio of Palms

30 de August de 2016 Rafael Marques de Morais

At a time of prolonged economic crisis, Angola has an interesting way of prioritizing who gets first dibs on its dwindling supply of foreign exchange. Angola’s President José Eduardo dos Santos recently told the central committee of his ruling MPLA (People’s Movement for the Liberation of Angola) party that the government had not received any contribution from Sonangol (the national oil company) since the beginning of the year due to the sharp decline in oil price. He added: “the income Sonangol does derive is barely enough to pay its own and the State debts.” Dos Santos admitted that this was causing a foreign exchange crisis for the National Bank of Angola, the BNA, which was only able to muster approximately US $300 million per month. That comes from receivables from foreign oil companies working in Angola, who are required to exchange their national currencies into Angolan kwanzas to pay in-country […]

China Chokes Angola Credit

19 de August de 2016 Rafael Marques de Morais

Is China beginning to lose patience with the Angolan regime? Maka Angola has learned that the China Development Bank (CDB) has declined to make any further funds available to the Angolan state oil company Sonangol, under a US $15 billion line of credit granted in December 2015, citing Angola’s “lack of contractual compliance” and attempts to “use the money for indeterminate ends”. Sources at the Angolan Finance Ministry have revealed that US $5 billion of December’s loan was intended to cover oil production costs, leaving US $5 billion for debt refinancing. In exchange Angola would increase its cargoes of crude to China. The other US $ 5 billion are for the Finance Ministry’s use. Until recently over half of the 50-60 oil shipments out of Angola each month went to the Western oil majors who operate the oil fields and platforms that allow Angola to export 1.8 million barrels per […]

Economy

Sonangol’s Billion Dollar Headache

21 de July de 2016 Rafael Marques de Morais

The task facing Angola’s state oil company, Sonangol, as it adjusts to lower revenues during the slump in oil prices, is complicated by a stratospheric debt burden which gives little room for manoeuvre. And yet the new administration is unexpectedly making repayment of one private debt a top priority. In spite of multiple pressing issues (including the root-and-branch restructuring of Sonangol) repayment of this particular debt has been fast-tracked by Sonangol’s new CEO, the President’s daughter Isabel dos Santos. A source close to the Sonangol board has told Maka Angola it’s the reason why Sonangol has been seeking a loan of US $800 million from a bank based in Egypt, offering as surety its shares in the Millenium BCP division of Portugal’s largest private bank, the Commercial Bank of Portugal (BCP). The urgent repayment? A one billion US dollar debt owed to Trafigura. This is the joint venture between the […]

40 Years On The Boys are Back

8 de July de 2016 Rafael Marques de Morais

Shrugging off the legal challenges to her appointment as President of the Board of Director of Sonangol, the President’s daughter, Isabel dos Santos, has lost no time in showing how she means to restructure the state oil company. Her first task has been to recruit 120 Portuguese staff to senior positions. The new recruits will join a further 50 consultants – also mostly Portuguese nationals – currently working as consultants and advisers to Isabel on behalf of the Boston Consulting Group and the Portuguese law firm Vieira de Almeida, who in effect are jointly running the Angolan state firm at this point. The arrival of the Portuguese contingent to take over at the Angolan state oil company raises some interesting points: firstly, the total absence of any national or international recruitment campaign and the lack of any attempt at dialogue between the managers and workers at Sonangol points to the same lack […]

Sonangol’s Debt Woes

6 de July de 2016 Rafael Marques de Morais

Angola’s state oil giant, Sonangol, is running out of time to prove it has a credible plan to repay US $13 billion in loans it obtained from a syndicate of European banks. The loans’ agreements came with a contractual obligation to produce annual balance sheets showing a healthy ratio of debt to capital and it appears Sonangol has been unable to honour this. Last month the London-based Standard Chartered Bank set a 45 day deadline for Sonangol to explain its failure to comply with the debt ratio obligation stipulated as part of the loan agreement, and to provide documentary evidence that is has the capacity to honour the terms of the loan. Sources close to the Board of Directors of Sonangol have indicated to Maka Angola that the company may not be in a position to make the repayments on time. It is alleged that Sonangol’s long-term auditor EY raised objections to some […]

Economy

Rescuing the Angolan Economy

29 de June de 2016 D. Quaresma dos Santos

President José Eduardo dos Santos admits Angola is running out of money but he has yet to outline any sort of rescue plan. Is Angola teetering on the precipice of economic disaster? Or is it already in the abyss? In spite of international entreaties to diversify the economy and reduce its dependence on imports, the MPLA government has so far failed to make meaningful changes to ensure self-sufficiency. So if the national bank has run out of money to pay for imported goods, what is the alternative? How can the government guarantee a continued supply of food to the Angolan people? Are they to starve? Can the President tell us where he expects to find the resources to avert calamity? With Angola already having to service billion dollar loans, the President may have run out of collateral. Clearly his generation of governing officials won’t have to bear the burden of […]

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