April 13 (UPI) -- With production close to a two-year low, presidential action in OPEC-member Angola has the potential to reverse a steady decline, analysis finds.
"Low oil prices and the fact that the majority of untapped oil reserves are located in deep and ultra-deep waters, which are more costly to develop, have discouraged foreign investors since 2014," Maja Bovcon, a senior analyst for Africa at Verisk Maplecroft, said in a brief emailed Friday to UPI.
Secondary sources reporting to economists at the Organization of Petroleum Exporting Countries estimated Angola produced around 1.5 million barrels of oil per day last month, down more than 80,000 bpd from February.
Angola is the second-largest oil producer in Africa, though a period of lower oil prices and field maturation are curbing its potential. Production for the OPEC member is at an 18-month low.
Angolan energy company Sonangol is working with a group of international partners on how to make the country's oil sector more attractive to investors. Action taken by President João Lourenço, meanwhile, would make it easier for major oil players to grab new acreage offshore.
"The fact that the new legislation has been adopted as a presidential decree, which is faster than passing it through the parliament, indicates Lourenço's commitment to speed up the reform of the oil and gas sector," Bovcon said.
According to analysis emailed from commodity pricing group S&P Global Platts, production from Angola is expected to kick up once production from the deepwater Kaombo field starts this summer. The filed could have a peak capacity of around 230,000 bpd.
In March, Italian energy company Eni and Sonangol started production at their joint deepwater Ochigufu project, which would add another 25,000 barrels to current levels. The new start up comes roughly a year after Eni operations began at the East Hub project in deep Angolan waters using an offshore floating production vessel capable of generating up to 80,000 bpd.
Angola is the third-largest oil supplier to China, the second-largest economy in the world, after Russia and Saudi Arabia, respectively. OPEC economists said Saudi Arabia has been picking up the slack because of declines in Russian and Angolan exports so far this year.