Oil fuels Angola's growing power

LUANDA, Angola, March 3 (UPI) -- Angola has become Africa's leading oil producer since its long-running civil war ended in 2002 and its state-run national oil company, Sonangol, is seeking a global reach that outstrips other African states.

But the main goal of the former Portuguese colony's dictator, President Jose Eduardo dos Santos, who has been undisputed ruler since 1979, is to unseat South Africa as the dominant power in southern Africa with access to his neighbors' mineral riches.

Angola has eclipsed Nigeria as the top oil producer in sub-Saharan Africa. It took over in 2008 after Nigeria's output was cut by one-third because of an insurgency in the rich Niger Delta fields and with Nigeria facing political turmoil Angola's position may be further strengthened.

With the United States and China vying for control of Angola's oil wealth, an echo of the ideological proxy war fought in Angola by the Americans and Soviets during the Cold War, dos Santos may well find Angola moving closer to his goal of making it a regional hegemon.

Much of Angola's exported oil goes to the United States and China.

"Angola … can play a free-agent role, playing the Chinese against the Americans should either demand conditions greater than Luanda is willing to accept," U.S. global security consultancy Stratfor said.

"This places Angola in a unique position of strong leverage and influence unrivaled in southern Africa."

Angola's proven oil reserves have grown from around 5.4 billion barrels in 1997 to an estimated 13 billion barrels. Production is currently 1.87 million barrels per day, compared to 165,000 bpd in 1975.

Output is expected to grow by 500,000 bpd in the next few years, with three ultra-deep offshore fields coming online by 2011.

Sonangol recently acquired a foothold in Iraq's Qaiyarah and Najma oil fields in the restive Nineveh province and is negotiating with several Western majors on exploration deals.

The secretive Sonangol, which wields immense power in Angola and is closely managed by dos Santos himself, is also in talks to acquire the Brazilian company Starfish, already a partner with a private Angolan concern Somoil which is closely linked to Angola's leadership.

In 2009, Sonangol won a 20 percent stake in Iran's vast South Pars natural gas field in the southern Gulf. Through its subsidiary, China Sonangol, the Angolan company owns 4 percent of the huge Ceput oil field in Indonesia.

A China Sonangol affiliate recently acquired vast mining rights in Zimbabwe and Guinea, extending Angolan influence deeper into the region.

Meantime, as Sonangol hunts oil and gas licenses around the globe, China Sonangol is snapping up prime real estate in New York, much of it bought from Israeli diamond tycoon Lev Leviev.

He has long had close links to the Angolan leadership since he overhauled the country's diamond trade in the 1980s, cutting out the de Beers cartel, which had dominated the industry for a century, and boosted revenue from a scant $2 million a year to $1.4 billion.

Dos Santos' family, along with other members of Angola's power elite are said to have benefited greatly from Leviev's activities.

The country has been ruled by the once Marxist popular Movement for the Liberation of Angola since independence from Portugal in 1975.

The MPLA's main civil war rival, the Western-backed UNITA movement, collapsed with the death of its leader Jonas Savimbi in battle in 2002. It is no longer a military threat but remains a political entity.

South Africa, Angola's biggest rival, will be no pushover and political analysts said dos Santos may not yet be ready to make an outright challenge to Pretoria.

Angola is vying for dominance in Namibia, Botswana, Zambia, the Democratic Republic of the Congo, the Republic of Congo, Mozambique and Zimbabwe. Strategically, it wants these countries to have friendly regimes to ensure that the MPLA's old enemy, UNITA, does not use them to rebuild their forces to challenge the Luanda regime.

According to media reports, Angola's military commander, Gen. Francisco Furtado, expressed support for a new peacekeeping force in Central Africa.

This was widely seen as a pretext by Angola to expand its influence in the region through the proposed force, as both Nigeria and South Africa have done in the past, particularly in any state that threatens MPLA rule.