Angola sees 2017 fold-output start in plan to cut oil reliance

Angola sees production from two gold mines being developed in the country’s north starting in 2017, helping diversify the economy of Africa’s second-biggest oil producer, Minister of Geology and Mines Francisco Queiroz said.

About $600 million has been invested in exploration for the metal at Mpopo in the southern Huila province, Queiroz said an in interview yesterday in the capital, Luanda. Development is also taking place at Chipindo in the northern exclave of Cabinda, he said. Both projects are public-private partnerships, Queiroz said, without naming the companies.

Angola, recovering from a 27-year civil war that ended in 2002, is looking for ways to cut its reliance on crude oil, which the government counts on for more than three quarters of revenue. Crude is trading near a five-year low, raising concern that the country’s budget deficit will increase, according to the International Monetary Fund.

“Given the uncertainty regarding financial resources, diversifying our economy is a must,” Queiroz said. “Investing in our mining industry will help us cope with such uncertainties.”

The only gold production taking place in Angola is illegal artisanal output by individuals in Cabinda province, he said. “We are starting up a licensing process so that miners can do it legally, according the mining code.”

Angola is the world’s fourth-biggest diamond producer by value and plans to invest in Zimbabwe’s gem industry through Sociedade Mineira do Catoca Sarl, whose shareholders include the government’s Endiama EP and a unit of Brazilian construction company Odebrecht SA.

Exploration for copper at the Mavoio project in the northern Uige province will start soon, and the country wants to make investments in bauxite, used to extract aluminum, in Guinea Bissau and in neighboring Namibia’s iron industry through state- owned Ferrangol EP, he said.