Angola The Business Opportunity You Never Knew About João Caiado Guerreiro

2. AngolaThe Business Opportunity You Never Knew About João Caiado Guerreiro

3. The present powerpoint presentation was drafted considering, amongst others, the following sources*: CIA World Factbook; U.S. Department of State; Diário Económico; Reuters News Corporation; Africa Energy Intelligence; Energy Information Administration – Official Energy Statistics of the U.S. Government. *Please note that due to the fact that Angola is a third world country the data contained herewith varies from source to source.

4. THE WORLD ECONOMIC AND FINANCIAL CRISIS, PERIOD OF RECESSION ANGOLA HIGH LEVELS OF GROWTH

5. INTERESTING FACTS: ANGOLA ANGOLA IS 5 TIMES THE SIZE OF THE UNITED KINGDOM AND OVER TWICE THE SIZE OF FRANCE

6. Population – 17,500,000 • Capital – Luanda • Area – 1,246,700 sq km • Language – Portuguese • Currency – Kwanza • GDP – 84 billion USD * • GDP per capita – 4,941 USD * *U.S. Department of State

7. Angola has made remarkable progress since its nearly 30-year civil war came to an end with the signing of a peace agreement in April 2002.

8. BEFORE 2002 CIVIL WAR FASTEST GROWING ECONOMY IN AFRICA AFTER 2002

9. FOURTH FASTEST GROWING ECONOMY IN THE WORLD - an average GDP growth rate of 15% (2002-2008)

10. OIL PRODUCTION 1,889 2,948 2,100 Million barrels per day

11. WHY ANGOLA? Angola is now a peaceful country; strategic geographic location; macroeconomic stability; inflation in single digits; growing international currency reserves; per capita income is now approaching that of middle income countries – 4,941 USD; it used to be a marxist country, whereas now the Government is promoting free enterprise, trade and investment.

12. POLITICAL STABILITY • FREE DEMOCRATIC ELECTIONS -5th of September of 2008 (MPLA won with 81,64%). • EXPECTED PRESIDENTIAL ELECTIONS IN 2009 - having the same President since 1979.

13. PORTUGAL IS THE PRIVILEGED PLATFORM FOR ACCESS TO ANGOLA historical and cultural proximity (Angola was a Portuguese colony up until 1975); Portuguese speaking country; easy access from Lisbon which has 3/4 daily flights to Luanda; Angolan law is inspired by Portuguese law (same civil code; corporate code, etc.).

14. 42 CONVENTIONS AND TREATIES BETWEEN PORTUGAL AND ANGOLA Bilateral Investment Treaty provides incentives, as well as additional protection to investors from both countries. Agreement on Enforcement of Court Judgements promotes the Judicial and Judiciary Cooperation between Portugal and Angola.

15. Customs Cooperation Agreement promotes the customs’ technical cooperation between Portugal and Angola.

16. ANGOLAN LAW Portuguese law as of 1975 = • Same Civil Code; • Similar Corporate Code; • The only differences relate mainly to details, except for Oil Law.

17. WHY INVEST IN ANGOLA? Government is committed to progress and investment: political stability establishment of a legal regime of incentives; economic and political reforms; free-market economy principles; offers credible legal protection and stability to investments. • Democratic legislative elections in September 2008 • Presidential elections expected in 2009

18. Incentives • Eligibility criteria • The tax and customs incentives, exemptions or reductions shall be granted in accordance with the following criteria: • Sector of activity • Development zone       • Special economic area         

19. Sectors of Activity • agro-forestry/cattle; • manufacturing; • fishing; • construction; • health and education; • roadway, railway, port, airport, telecommunications, energy and water infrastructures.

20. Development Zones Zone A- Province of Luanda, as well as the main municipalities of the provinces of Benguela, Huíla and Cabinda. Zone B- Remaining municipalities of the provinces of Benguela, Cabinda and Huíla and provinces of Kwanza Sul, Bengo, Uíge, Kwanza Norte, Lunda Norte, Lunda Sul and Zaire. Zone C- Provinces of Huambo, Bié, Moxico, Kuando-Kubango, Cunene, Namibe and Malange.

21. Special Economic Zones These areas are defined by the government on a project need basis.

22. Angola is one of the most difficult, yet most rewarding countries to do business in…

23. SPECIFIC OPPORTUNITIES IN 5 KEY SECTORS: 1. Energy & Renewable Energy 2.Housing andInfra-Structures 3.Agriculture 4.Mining 5. Manufacturing

24. 1. ENERGY • OIL • GAS

25. OIL Angola’s economy growth is mostly due to the increase of oil production.

27. The control of the oil sector is secured by a State-owned group - SONANGOL. ANGOLA was in 2008 the biggest oil producer in Africa.

28. OTHER INTERESTING FACTS REGARDING OIL PRODUCTION IN ANGOLA: • Proven oil reserves of 9.0 billion barrels as of January 2008; • Oil production expected to reach 2,8 million bpd by 2012; • In the oil sector Angola always hits its growth targets, because it always respects its contracts; • Sonangol works together with ExxonMobil, Chevron, Shell, BP, Petrobrás, Galp, Total, etc. • Please note that according to recent news and following the oil prices’ reduction, Angola, as an OPEC member, will be forced to decrease its oil production to 1,55 million barrels per day.

29. NEW IMPORTANT PROJECTS: • SINOPEC • SONAREF

30. SINOPEC • China’s state oil company; • Entered the market offering two separate 1 billion USD signing bonus offers on two offshore blocks; • Formed a partnership with Sonangol. SONAREF • Refinery in the coastal city of Lobito with capacity for a production of 200,000 bbl/d; • The project is worth 3.5 billionUSD and is able to process heavy crudes; • Sonangol is proceeding with the project and refining is to start in 2012.

31. NATURAL GAS Angola is a world-class hydrocarbon region and its role is expected to increase in the future.

33. Regarding natural gas, there are currently some projects in Angola for its transport from the oil reservoirs located offshore into the international markets, starting as of 2012.

34. LIQUIFIED NATURAL GAS PROJECT • Angola LNG Project is a joint venture between the following investors: • Sonangol • Chevron • BP • Total • ENI Having already invested US $ 4bn, inorder to produce 5.2 million tones a year.

35. ANGOLA’S LNG PROJECT MISSION To develop a Liquefied Natural Gas plant in Soyo, Zaire Province, Republic of Angola, to export it to Atlantic Basin markets and provide natural gas for use in the Angolan domestic market.

36. THE DEVELOPMENT OF THE LNG PROJECT INCLUDES: • the construction of an onshore liquefaction train with storage capacity of 360,000 cm for LNG, LPG (liquified petroleum gas) and condensate; • a loading jetty for LNG tankers; • the building of a pipeline to transport natural gas to Angolan markets.

37. TOTAL INVESTMENT Although the total project cost has not been released, Angola LNG Project has been considered as the "largest single investment ever made in Angola"by Angola’s minister of petroleum. Despite the aforementioned, it is estimated that such investment shall reach around 8 billion dollars.

38. ANGOLA IS SET TO EXEMPT COMPANIES EXPLORING FOR NATURAL GAS FROM PAYING TAXES On the 24th of March 2009 the Angolan Parliament voted as to allow the Government to implement a law that exempts gas firms in Angola from any tax burdens.

39. SONANGAS (subsidiary of state-owned oil company Sonangol) 10-YEAR GAS EXPLORATION RIGHTS Eni Angola Exploration BV, Gas Natural West Africa SL, Galp Exploration Petrolifera SA and Exem Energy BV

40. Opportunities for all types of companies in the Oil & Gas sector Involved are already the big players (ExxonMobil, Shell, BP, Eni, etc.) and their usual suppliers (Technip, Schlumberger, Halliburton, Bechtel). Nonetheless, there remain abundant opportunities for all types of suppliers, from Cateringto Hotel and Engineering services!

41. RENEWABLES • SOLAR POWER • WIND POWER • HYDROPOWER The distribution of electricity in the country is not uniform due to a destroyed network, so Angola’s government decided to bet on renewable energies.

42. FIRST FORCE – BIODIESEL PROJECT First Force is a sound project in the field of crude vegetable oils for international biodiesel industry that is commited to contribute to Angola’s development.

43. PROJECT FUNDAMENTALS • Off-take pre-ageements with leading biodiesel players; • Investment of $200-$300 million; • Privileged access to the European markets; • Initial target production of 200,000 metric tons; • Life-span of 25 years.

44. 670,000 tons 400,000 tons $ 210 M $ 171 M 299,000ha 172,000 tons Oilseed Meal Total arable land Crushing capacity beans CapEx (cum. 3 years) Sales Oil Production First Force in numbers: Angola

45. 2. HOUSING AND INFRA-STRUCTURES There is a whole country to rebuild!

46. END OF DEVASTATING 27-YEAR CIVIL WAR IN 2002: Angola’s government engaged in a considerable reconstruction of roads, railways, bridges, airports, schools, hospitals and residential housing.

47. In 2005 the Government began using a vast amount of credit from China (around 7 billion USD) to rebuild Angola’s public infrastructures, as well as for the investment in several other large-scale projects. Meanwhile, other countries such as Portugal (providing around 2 billion USD), Brazil and Germany also started financing Angola through huge credit lines worth several billions of dollars, in order to contribute to the country’s overall development.

48. GOVERNMENT SUPPORT PROGRAMMES: National construction programme 1 million houses by 2012 Ministry of Hotel and Tourism plans to build around 50new hotelsbefore 2010 when Angola hosts the African Soccer tournament.

49. ONE MILLION HOUSES BY 2012 Public-private partnerships for purposes of housing construction are being created. HOW WILL THE COMPANIES BE SELECTED? Via tendering procedure where the most advantageous tender will be chosen.

50. In this context, some contracts have already been awarded to local companies for the building of approximately 200.000 houses. Consequently, there is an opportunity in what regards supplying some of these companies.