Angola has the potential to be oneof Africa’s richest, most successfulcountries. Its 18 provinces boastenormous mineral wealth and thecountry is already the second-biggest oil producer on the conti-nent, after Nigeria.

Following the peace agreementin 2002 that ended the 27-year civ-il war, President José Eduardo dosSantos and his government haveworked diligently through tryingtimes to find internal solutions thathave brought peace to the countryand promoted its presence at theinternational level.

Those efforts have already madea huge difference in the lives of or-dinary Angolans. Gross domesticproduct has grown rapidly, at an av-erage pace of more than 15% from2004 to 2007, and more than 10%in 2008, before contracting slight-ly in 2009. The economy will ex-pand between 6.5% and 7.5% thisyear, according to the World Bank’sestimate.

Dos Santos’s economic team hasalso had great success in fightinginflation, which disproportionate-ly hurts the poor by reducing thevalue of their already meager in-come and savings. Price increasesplunged from an annual rate of325% in 2000 to less than 13%in 2008.

One of the government’s sig-nature efforts has been a nation-al reconstruction program whoseobjective is to modernize the coun-try’s infrastructure after the war.The goal of the projects fundedby the program is to rebuild An-gola’s biggest and most importantinfrastructure assets, with the ul-timate objective of improving thequality of life of the country’sresidents.

The program has been very suc-cessful in spurring the rapid ac-celeration of economic growth.When the country gained its inde-pendence from Portugal in 1975,it possessed one of Africa’s best andmost extensive road networks. Re-building the country’s transportarteries is now a priority becauseof their importance to moving con-struction materials for other pro-jects around the countryside.

There are other projects that willhelp Angolans even more directly.One of the government’s most am-bitious programs aims to build 1million new houses around the coun-try by 2012, for about $50 bil-lion. Angolans have taken note ofall these efforts and shown their sup-port for the government in recentelections.

The governing party is the Pop-ular Movement for the Liberationof Angola, or the MPLA. The group

has ruled the country since the endof the armed conflict in 2002, andits efforts have won the strong sup-port of Angolans. The party won thenational elections in September of2008 with about 80% of the vote,a huge margin signaling to the restof the world that Angola is a sta-ble democracy, dedicated to im-proving the lives of its citizens.

Most of the economic growthrecorded in recent years has comefrom the country’s oil production,which represents about 85% ofGDP. The government is aware ofthe country’s dependence on oil,and the need for a more variedeconomy to spur new job creation,and has been working to promoteother industries, including tourism,mining and agriculture.

Before the civil war that beganin 1975, following the country’s in-dependence from Portugal, Ango-la was an iron ore exporter and adiamond producer. The war de-stroyed most of the country’s ironmining infrastructure, but the in-dustry has been making a come-back in the past few years.

Diamond production, thoughgreatly reduced by the war, has beenanother success story since the endof the conflict. Angola is already theworld’s sixth-largest diamond pro-ducer, according to Endiama, thestate-owned monopoly.

Angola’s 18 provinces offer mar-velous diversity. The seven provincesalong the country’s 1,000-mile-long coast on the Atlantic Oceanrange from the lush jungles of Cabin-da and Zaire provinces in the northto the plains and deserts that pre-dominate in the southern provinceof Namibe. Bengo, Benguela andKwanza Sul are known for theirbeautiful beaches, with Bengo clos-est to the Luanda capital district.

The inland provinces also boastbeauty, for example in the dense rainforests of Uíge, along the Congo bor-der, and Cuando Cubango, with itsabundant wildlife. They’re alsowhere much of the country’s under-exploited mineral wealth lies, withthe important exception of oil.

Lunda Norte and Lunda Sul areboth diamond-mining centers,while Uíge has deposits of copper

and cobalt. Moxico has the coun-try’s second-biggest timber in-dustry, after Cabinda, and alsocontains exploitable deposits ofcopper, gold, diamonds, uraniumand other substances.

Other inland provinces includeKwanza Norte, one of Angola’srichest agricultural areas, produc-ing corn, peanuts, pineapples, peas,sweet potatoes and a variety ofbeans. It is also the home to thecountry’s largest hydroelectric sta-tion at the dam at Cambambe,which supplies power to local res-idents and businesses.

Huambo and Bie provinces haveexcellent hydroelectric potentialbecause of the numerous rivers thatcross them, while Huila province hasgreat tourist potential. Huila’s pic-turesque tablelands, small moun-tains, valleys and rushing streamsand rivers provide many sites thatvisitors might like to see.

No discussion of Angola’sprovinces would be complete with-out mentioning Cabinda. Cabindais the small, oil-rich part of An-gola that is separated from the

rest of Angola by a 25-mile-widestrip of the Democratic Republicof Congo. The province, which isalso rich in other natural resources,has undergone a huge change forthe better since 2006, when apeace agreement with a separatistgroup was signed.

Cabinda is Angola’s biggest oil-producing province, with most ofthat production coming from off-shore wells. Cabinda keeps 10%of the oil income generated by theoffshore oil rigs that produce abouthalf of Angola’s total oil output.That revenue, combined with wisegovernance on the part of the lead-ers in Luanda, Angola’s capital,and in Cabinda City, are reshap-ing the province.

Angola has made great progressunder the governance of Presi-dent dos Santos, and has alreadybegun to play a bigger part in in-ternational affairs. As soccer fansalready know, Angola hosted theCAN2010 African soccer cham-pionship tournament this year,which was won by Egypt on Jan-uary 31 in Luanda.

Cabinda

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OIL & GAS

New investment inflows areupping production rates andsocial development projects Page 3

EDUCATION

As the province focuses oneductation, students of all agesare headed back to schoolPage 6

CABINDA PROJECTMANAGER:Alex de la Mare

ALSO INSIDE

Finance 2Infrastructure 4Industry 5Tourism 7

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Oil-rich Angola grows stronger andmore stable each and every day �Location:An enclave of Angola,

separated from the mainlandby the Democratic Republicof Congo and the Congo River

�Capital:Cabinda City

�Population:Approximately 300,000, ofwhich half is rural and theother half urban

�Industry:Oil extraction and refining,construction materials, foodproduce, wines, palm oil andpalm oil products, tobacco,crude rubber, hardwoods,timber and furniture

�Agriculture:Mainly bananas, coffee,cacao and cassava

�Area:7,823 km2 (3,020 sq mi)

�Municipalities:Belize, Buco Zau, Cabindaand Cacongo

�Founded:1885, by Portugueseexplorers

�Independence:1975. Cabinda was the sceneof heavy fighting during thewar for independence fromPortugal (1961-75)

�Geography:Largely tropical forest

�Religion:74.9% Catholic

�Ethnic groups:Bawoyo, Bacongo, Babaling,Bassundi, Bavili andBacotche

�Climate:Equatorial climate, theaverage temperature being25ºC (77ºF), with an altitudeof 209 meters (686 feet)

��Governor:Mawete João Baptista

Excluding its oil industry, Cabinda is the second largest contributor to Angola’s GDP after Luanda

FACTS ANDFIGURES

After the long, post-independenceperiod of civil strife in Cabindaand the rest of Angola, the gov-ernment is serious about its re-sponsibility to provide its citizenswith the necessities of life, in-cluding political, social and eco-nomic stability, health care, ed-ucation, and the opportunity toearn a living.

Cabinda has now enjoyed morethan three years of relative peacefollowing the signing of the Mem-orandum of Understanding (MOU)on August 1, 2006 by the gov-ernment and the group repre-senting the separatists, the Cabin-da Forum for Dialogue.

That agreement marked the be-ginning of a new era for theprovince, in which its consider-able mineral wealth is now beingused to improve the lives of the re-gion’s people. In the time since theagreement was signed, Cabindahas made great strides in that di-rection, but more must be done andCabindans need to do their partwith a feeling of solidarity.

The welfare of the people hasbeen the government’s prioritysince the start, and it has demon-strated that focus for years. Cabin-da’s children have especially ben-efited from these efforts, as newschools have been built all aroundthe province.

Students every year are giv-en uniforms and school supplies,and every day they’re given a nu-tritious snack. Ensuring theirhealth is a major goal as well,and the province has establishedmobile health clinics that gofrom school to school, givingkids check-ups.

There have been polio vac-cine campaigns, and childrenreceive medicines to protectthem against parasites and oth-er ailments. Making sure theyhave healthy teeth has been thefocus of another program thatprovides every child with a den-tal hygiene kit.

Cabinda’s adults have been inneed of help too, and the gov-ernment has not forgotten them.Adult schooling has been fund-ed to educate people who wereunable to go to school as chil-dren because of the civil con-flict. A special effort is beingmade to help reintegrate thefighters from the separatistgroups that laid down their armswith the signing of the peaceagreement.

Reintegration was a mainpromise made by the central gov-ernment to the separatists, alongwith promising Cabinda certainspecial rights and guaranteeing

Cabindans positions in the pres-ident’s cabinet.

To date the central governmenthas been diligent about fulfillingits responsibilities under theMOU. The government has bud-geted funds to carry out two ofthe most important tasks re-maining, which are helping fight-ers from the Front for the Lib-eration of the Enclave of Cabin-da return to civilian life, and help-ing refugees still living in near-by countries return to theprovince.

A program to help fightershandicapped by the war find jobshas been successful, buying taxisthat are shared by various formerfighters, and supplying others withindustrial equipment they can useto start up their own businesses.

Of course, the government’s pro-grams to improve the well-beingof Cabinda’s population extends farbeyond building schools and clin-ics. Building up the province’stransportation and sanitation in-frastructure also helps to fomentstability in the region.

It also establishes the necessaryingredients for the provincial gov-ernment’s biggest goal: to trans-form Cabinda over the next fourto ten years into a province of greateconomic importance, integrallystrategic for Angola beyond oil.

Living a new era of stability and prosperity

REFORM

Cabinda’s Provincial Governor,Mawete João Baptista, has beenon the job since November, 2009,and has spent the time since hemoved into the position getting toknow the region, its local leaders,and the problems that need to bedealt with to continue the work ofimproving the lives of theprovince’s residents.

In recent months Baptista hasheld meetings with local chieftains,the leaders of a provincial bankinggroup and other regional organi-zations, and in February he start-ed a policy of meeting with citizensand civil servants every Tuesday inorder to learn about and help solvethe problems facing Cabindans andthe regional government.

Baptista’s government has iden-tified several priorities, and hasplaced improving the province’shealth care system right at thetop of the list.

“We’re going to open hospitalsand medical clinics to treat malar-ia, tuberculosis, diarrhea and oth-

er illnesses, and provide women withacceptable conditions at maternitywards around the region,” Baptistasaid during a speech in February.

His goal is always to offer theregion’s residents the best, mostefficient public services possible.He recently told Cabindans thathe plans to oversee the operationof public companies more close-ly, to make sure they’re managedcorrectly and for the benefit ofthe people of the province.

As part of his intention to makethe provincial government more re-sponsive to local needs and events,Baptista was quick to promise sup-port to the victims of March’s tor-rential rains that destroyed 65 homesin the Cabindan town of Caio Litoral.

Baptista brings a great deal ofexperience to his posting. He wasgovernor of Uíge province imme-diately before taking the same jobin Cabinda, and before that hewas Angola’s ambassador to theDemocratic Republic of Congo(DRC) for 10 years. Cabinda is sur-rounded on three sides by DRC,so his knowledge of the neigh-boring country can be particu-larly useful to the province.

Baptista’s ethnic background,from the Bacongo group that is pre-sent in Cabinda, should help thegovernor gain the sympathy of manyof the province’s residents.

Carrying forwardCabinda’s legacy ofprogressThe new governorhas taken up thebanner of hispredecessor’sreforms

NEW ADMINISTRATION

The province of Cabinda no doubt plays a key role in adding wealth to the nation’s coffers

Projects to feed, clothe and equip schoolchildren are now underway

Health care and education are at the forefront as a stable economy and government emerge

CABINDA WSJ 8 pages (2).qxd 11/6/10 13:54 Página 1

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Cabinda

Angola’s history since gaining in-dependence from Portugal in1975 has largely been about civ-il wars and separatist movements.After the two main groups thathad been fighting signed a peaceagreement in 2002, the countryhas had the opportunity to moveforward and rebuild the damagedone by the conflict.

President José Eduardo dosSantos and his government haveworked non-stop to improve thelives of Angolans since the peaceagreement was signed on April 4,2002. Even with the signing ofthat agreement, however, the cen-tral government still had onearmed conflict to settle, in theoil-rich Cabinda province.

When the peace agreement be-tween the Angolan central gov-ernment and the Cabindan sepa-ratists was finally signed in 2006,it opened the door for foreigncompanies to come to the provinceand seek out potentially lucrativeinvestments.

President dos Santos sent ahandpicked team to negotiate thepeace pact, and it took them twoyears to reach an agreement withthe leaders of the separatist group.The province is already reapingthe benefits of the newfound sta-bility.

The U.S. has long had com-mercial relations with Angola,based initially on interest in theAfrican country’s abundant oiland gas resources, but more re-cently on the desire to help spreadpeace and development across thecontinent.

American oil companies begantheir operations in Angola whileit was still a Portuguese colony,and that involvement continued af-ter independence in 1975 andduring the civil conflict thatwracked the country in the fol-lowing decades.

The 2006 Memorandum of Un-derstanding signed by the Cabin-dan separatist forces and Ango-la’s central government finallybrought an end to the conflict inthe province, an advance the U.S.strongly supported, calling it a“significant step” towards peace.

“For the people of Cabinda,this Memorandum of Under-standing is more than just a doc-ument on peace and reconcilia-tion,” the White House said in astatement released at the time ofthe signing. “It is the promise ofeconomic development and in-creased political influence.”

The U.S. has since then beenactively contributing to develop-ment in Cabinda. USAID hasagreed to continue funding a non-governmental organization calledSearch for Common Ground thatis helping to reduce conflict inthe province while also improv-ing infrastructure.

USAID agreed to increase its

funding of the group to $600,000,from $490,000 in the previoustwo years, after judging that theNGO had managed the originalfunds satisfactorily.

Search for Common Groundholds seminars and other meet-ings intended to help people findpeaceful ways to resolve conflicts,and has also participated in fund-ing the construction of a 25,000-liter water tank in the Cabindanvillage of Mandarin, and in im-proving local roads.

“This agreement we’re signingtoday to support Search for Com-mon Ground’s program is also anopportunity to commemorate ourmutual commitment for the de-velopment of Cabinda,” said Su-san Brems, the then-director ofUSAID, during the signing.

USAID is also working withother groups, including Chevronand its partners in the Block Ze-ro oil field, to help improve thelives of Cabindans. The oil com-panies working on the block

agreed to contribute $3 million,and USAID $1 million, to a pro-ject to promote commercial agri-culture.

The money is being used to trainfarmers to improve productivityand quality, and to help set upwarehousing and dis-tribution infrastruc-ture. The program isexpected to create5,000 new jobsspread across 1,000farms. The goal is forat least some of theextra food producedto be sold toChevron’s Malongooil terminal, locatedonshore in Cabinda.

“Chevron is deter-mined to increase itspurchase of suppliesfrom Angolan companies as muchas possible,” says Alan Kleier,general director of Chevron’s unitin Angola. “Companies here havebenefited in that way.”

USAID and several partners al-so participate in the Municipal De-velopment Program, which is in-tended to promote participation ingovernment and to make local gov-ernments more efficient as theywork to meet citizens’ needs.

The program oper-ates in several An-golan provinces, andwas first launched inthe country in theprovince of Cabinda,with funding of morethan $8 million to im-prove local adminis-trators’ ability to plan,budget, implementand oversee local de-velopment programs.

An interesting pro-ject started in 2006,and funded by

Chevron through the CabindaAgribusiness Development Al-liance (CADA), is helping to startup a local honey-producing in-dustry. As part of the program,

CADA has brought in experts totrain beekeepers and teach themhow to build and maintain hives.

All of these efforts to help An-gola are part of the U.S.’s desireto improve relations with this keyAfrican country. During the ad-ministration of George W. Bush,the U.S. worked consistently to-ward that goal, and that workwill continue under PresidentBarack Obama, according to U.S.Ambassador Dan Mozena.

Angola, and in particular,Cabinda, are the sites of some ofthe biggest investments in oilmade by U.S. companies abroad,and the new administration willwant to work to expand invest-ments into other economic sectors,the ambassador explains.

Angola can also play a larger rolein the rest of Africa, Mozena says.It has one of the continent’s biggestand most professional armies, andso has the ability to play an im-portant part in peacekeeping tasksin various conflicts.

End of war means beginning of growthPeace has been achieved in the Angolan province, bringing with it new economic growth and FDI

PROGRESS

Cabinda is open for business andlooking for investors. The regionboasts abundant natural resourcesthat can contribute to Cabinda’seconomic growth and companies’bottom lines.

Despite Cabinda’s many other re-sources, petroleum has long been thefocus of foreign investment in theprovince, and that will remain thecase for years to come. Angola isafter all Africa’s second-biggest oilproducer, after Nigeria and aheadof Libya, and Cabinda has long beenthe most important region for thecountry’s petroleum industry.

Currently, the bulk of the region’soil production comes from offshoreplatforms, in the areas known asBlock Zero and Block 14. Block Ze-ro is one of the country’s most pro-ductive areas, pumping about370,000 barrels per day in 2007.

Tombua Landana, an ambitiousproject which includes the con-struction of one of the tallest struc-tures on the planet, produced its firstoil in September of last year and isexpected to reach peak productionof 100,000 barrels of oil next year.

At 474 meters (1,554 feet), mostof the oil rig is submerged. Thedeepwater drilling rig is taller thanthe Sears Tower in Chicago anddwarfs the Eiffel Tower.

The total investment in the pro-ject will be more than $3.8 billion,which will include more than $272million of local content spending.The project maximizes the use ofAngolan engineering, procurement,construction and installation capa-bilities. Non-Angolan companiesthat won contracts as part of theproject include Daewoo Shipbuild-ing & Marine Engineering Co. andVetco Gray of the U.K., a supplierof equipment and services for on-shore and offshore drilling.

As part of its investment inCabinda, Chevron is spending $2million to help fund the construc-tion of a maritime water testing fa-cility. The local government and theFishing Ministry are also con-tributing to the project, which willcarry out biological, chemical andheavy metal testing of the seawa-ter in the region.

For decades, most of the oil pro-duced in Cabinda came from off-shore wells because of security con-cerns that prevented investors fromexploring onshore areas. Now thatpeace has come to Angola, more isbeing spent to identify promising ar-eas and to develop any interestingdiscoveries.

Estimates of the onshore reservesin Cabinda vary, but experts arevery optimistic that the region con-tains large reserves, possibly evenlarger than the proven deposits off-

shore. That has prompted some an-alysts to dub the region the ‘Kuwaitof Africa.’

One field, called Massambala-1,was estimated last year to contain170 million barrels of oil, morethan five times the amount originallythought. Roc Oil of Australia, witha 60% stake in the Cabinda Southblock where Massambala-1 is lo-cated, has already begun explo-ration in other areas of the province.

Cabinda’s, and Angola’s, oilwealth has attracted investors fromall around the world. Chinese com-panies are also very interested in thearea, and have long been present allaround the country.

Earlier this year, China Petrole-um and Chemical (Sinopec) signedan agreement with Sonangol to buya stake in Angola Block 18, a deep-water well that has been in opera-tion since 2007.

No stranger to foreigninvestment Cabinda has longhad aninternationalpresence on andoff her shores

FDI

Cabindans now enjoy pleasant public areas thanks to public works projects

Josefina Pitra Diakite,Angolan Ambassador to the U.S.

FDI is expanding Cabinda’s rich oil supply with new technologiesand more production areas

With peace has come increased economic stability in Cabinda

Angola’s banks are getting moreand more involved in financing thecountry’s expansion, according toa study published recently by con-sulting group KPMG Angola.

The Angolan government realizedlong ago the country’s private bank-ing system would need some helpto finance growth. The Banco deDesenvolvimento de Angola, orBDA, was set up in 2006 by thegovernment to “accelerate the bal-anced and sustainable developmentof Angola, by providing for the cre-ation of employment and income,the modernization of social andeconomic structures and the in-crease of competitiveness in thecountry.”

The BDA has been very active inCabinda, particularly in financingthe expansion of businesses thatmake construction supplies. De-mand for such supplies is strong be-cause the many infrastructure pro-jects have caused a boom in con-struction, and shortages of manysupplies have been slowing someprojects down.

One example is brick-makingbusiness EMPEBAT – Empresa Ex-ploradora de Burgau, Areia e Ter-ra. EMPEBAT borrowed $2 mil-lion to buy equipment to increaseoutput and help supply materials forthe construction of new housing inthe province.

Another way that Angola’s gov-ernment has played a key part inthe growth of both the banking sec-tor and the economy itself has beenby pursuing macroeconomic sta-bility and reforming the country’sbanking regulations. That way thegovernment has created the condi-tions necessary for the expansion tobegin and to continue, all of whichis benefiting regular Angolans.

The gains from the growth are al-ready being returned to the econo-my by private banks in growing pro-portions. In 2007, banks channeled75% of deposits back into the econ-omy in the form of credits, way upfrom 2006, when just 43% of de-posits were turned into credit.

Cabinda is also benefiting fromthe increased interest on the part

of banks in expanding within thecountry. The number of banks withbranches in the province is grow-ing, with Banco de Poupança eCrédito (BPC), Banco de Comér-cio e Indústria (BCI), BancoAfricano de Investimentos (BAI),Banco de Fomento de Angola(BFA), Banco Totta de Angola(BTA), Banco Internacional deCrédito (BIC), Banco Sol, BancoEspírito Santo Angola and BancoMillennium already there.

Angola’s banks have risen closeto the top of the rankings for Africanfinancial institutions, according toa recent report by the BNET Busi-ness Network. Angolan banks werethree of the top 10 banks on theBNET website’s Top 25 AfricanBanks ranking, accompanied on thelist by seven South African lenders.

BFA was the highest ranked, atnumber seven, followed by BAI inthe eighth position, while BPC camein at number ten. All these banksare growing rapidly as they benefitfrom Angola’s strong economy,BNET said in its report.

The province benefits fromthe banking boomForeign and domestic banks are increasing their presence in Cabinda

FINANCE

The U.S. hasproven itscommitmentto Cabindathroughvarious USAIDprograms andfunding

Angolan Ambassador JosefinaPitra Diakite speaks about hercountry’s progress and bilater-al relations with the U.S.

What are your views on Ango-la’s growth prospects for thisyear and next?

I think the crisis that the oilsector faced, between the re-duction of its prices in the in-ternational arena and the glob-al economic crisis, in a way helpedthe Angolan government in termsof thinking to engage in the di-versification of its economy aswell as the recovery and mod-ernization of infrastructure. In-frastructure has recovered, interms of construction, rehabili-tation of roads, education, agri-culture, health care and housing.

The government pledged tobuild one million new homes be-tween 2009 and 2012. Also, thediversification that is happeningis not limited only to Luanda, oreven the main towns likeBenguela, Cabinda and Huam-bo or Huíla; infrastructure is be-ing improved everywhere.

What is your outlook on U.S.-Angola relations under the Oba-ma-Biden administration?

Bilateral relations are verygood at this point and have de-veloped even faster than we’dexpected.

Our Minister of Foreign Af-fairs, H.E. dos Anjos made an of-ficial visit to the U.S. and Sec-retary Clinton expressed that theU.S. wants to be a part of An-gola’s rehabilitation, recon-struction and the building of the‘New Angola’. Last August, Sec-retary Clinton visited Angolafirst on her African trip; not be-cause it starts with an ‘A’, she said,but because Angola is getting an‘A’ in everything it is doing.

Secretaryof StateClinton hasgiven Angolaan ‘A’ foreverythingit is doing

CABINDA WSJ 8 pages (2).qxd 11/6/10 11:10 Página 2

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Cabinda

Oil companies are constantlyseeking newer and more cost-effective ways to extract oil andother petroleum products fromthe earth. The constantly grow-ing demand for energy prod-ucts means that drillers have tobe ready to go to some of themost inhospitable parts of theworld, including deep under thesea, to satisfy the world’s needfor crude oil.

Recent discoveries off theBrazilian coast, for example,are going to require drilling plat-forms that will stand in seas asdeep as 1.2 miles, and that candrill as deep as 3.1 miles moreunder the seabed, through denselayers of salt and rock.

Fortunately for the companiesoperating in Cabinda, theprovince’s oil is more accessi-ble than the crude in Brazil’sTupi field. Nevertheless,Chevron has been exploring thedeep waters of Cabinda foryears, and just last year beganproduction at Tombua Landana,the $3.8-billion project that in-volved the construction of oneof the tallest man-made struc-tures on the planet.

The rig, located 50 miles offthe Cabindan coast and at adepth of 1,200 feetof water, consists ofa large, multiple-deck structurewhich contains pro-duction facilitiesand a 120-personaccommodationbuilding. The entirestructure measures1,554 feet high.

Production on theplatform, which isin Block 14, is ex-pected to reach itspeak of 100,000 barrels of crudeper day next year. One of theproject’s many innovations isthat it was designed for zero dis-charge of produced water, andanother is that none of the gasproduced by the well will be rou-tinely burned off.

Instead, the gas will be soldthrough the Angola LiquefiedNatural Gas plant, which is cur-rently under construction inSoyo, in Angola’s Zaire province.Zaire province is in the north of

Angola, just over the border fromthe Democratic Republic of Con-go, making it the closest part ofAngola to Cabinda.

Chevron and other companiesoperating in Cabinda and Angolaall try to get as much labor andsupplies as possible from with-in the country. All that activityis helping the country develop its

own oil-services in-dustry. Chevron be-gan production onanother one of its off-shore wells last year,known as MafumeiraNorte, in Area A ofBlock Zero, using aplatform construct-ed in Angola.

Sonamet, an An-golan oilfield con-struction and ser-vices company, wonthe multi-million

dollar contract for engineer-ing, procurement, constructionand installation of the platformand built it at its constructionyard in Lobito, in the south ofAngola.

For Sonamet, an Angola-based joint venture betweenstate-owned oil company So-nangol and Acergy, a construc-tion company based in Norway,it was a first – as it was for anyAngolan company – to be award-ed a contract of this nature.

As a country with vast pe-troleum resources, Angola hasa tremendous opportunity touse the funds generated fromoil to develop the country,providing its citizens with thepolitical and economic sta-bility they deserve. The pre-vious administration tookmany steps to make sure thatAngola gets as much of thebenefit as possible from itsoil wealth.

One of the most importantways the government has en-sured Angola, and Cabinda,hold on to a big part of therevenue generated by their oilis to have Sonangol, the state-owned company founded in1976 to manage the coun-try’s hydrocarbon resourceexplorations, take importantstakes in all the oil blocks thatare open for exploration anddevelopment.

Since its founding, Sonan-gol has taken a great inter-est in training Angolans towork in the oil industry sothat as much of the employ-ment created by the sector aspossible will go to the coun-try’s citizens. To that end, thecompany has sent workersabroad for training and helpset up the curricula of tech-nical schools that have openedin Angola.

Chevron Corp. of the U.S.and Sonangol are the twobiggest oil companies oper-ating in Angola, and both havebeen diligent in promoting thedevelopment of the local oil in-dustry and training local staffas much as possible.

Chevron has been very suc-cessful in this endeavor. An-golans represent about 87%of the local company’s work-force, and 75% of professionaland supervisory staff in thecountry are Angolans as well.

Innovativeextraction projectsNew technologies are revolutionizingthe drilling process

OFFSHORE

The natural gas that flows from oildeposits used to be burned off as anunwanted by-product. Now that nat-ural gas has also become a valuablecommodity and source of energy, oilcompanies around the world are ea-ger to capture the gas for sale.

Cabinda, and all of Angola, arerich in natural gas, with 9.6 trillioncubic feet of reserves for the wholecountry as of January 1, 2010, ac-cording to the Oil and Gas Journal.That figure is up from an estimateof 2 trillion cubic feet in 2007.

Oil producers in Angola are work-ing to cut the amount of wasted gas.In 2008, Angola produced about355 billion cubic feet of gas, of which69% was vented or flared, 23% rein-jected into the wells and only 8% wasused domestically, according to theU.S. EIA.

Chevron and its partners in Cabin-da’s Block Zero oil production field,Sonangol, Eni SpA and Total SA,last year inaugurated the Takula GasProcessing Plant (TGPP) to elimi-nate the need to burn off the gas andto permit it to be processed, storedand transported so that it can eitherbe sold or used to generate elec-tricity in Angola.

The Takula field, located in AreaA of Block Zero, has been one of An-gola’s most productive areas. Dis-covered in 1971, production start-ed in 1982, and is expected to pro-duce until after the year 2025.

TGPP represents a major successfor the Area A project as it will pro-vide additional compression and gassweetening in Block Zero.

The AAGM, as the Area A GasManagement Program is known,consists of three parts, including theTGPP, the Cabinda Gas Plant andthe Flare and Relief Modification pro-ject, which together eliminate the rou-tine burning of natural gas in the areaby permitting the fuel to be collect-ed and processed.

The TGPP can process approxi-mately 100 million standard cubicfeet of gas per day, which will be de-livered to the new facility onshorein Cabinda. Chevron and partnersare also building a natural gas liq-uefaction plant in Soyo Province

that will allow for the export of gasonce the plant is finished.

The liquefied natural gas plantwas announced in 2008, and con-struction has already begun. It isplanned to process about 1 billioncubic feet of natural gas a day andto produce about 5.2 million met-ric tons a year of LNG and relatedproducts such as propane, butane andcondensate.

The TGPP, located offshore in theTakula field, stands in water that’sabout 186 feet deep. The supportstructure was built locally, in Lobitoin Angola’s nearby Benguela

province, while the processing plantwas built in South Korea by Sam-sung Heavy Industries and then trans-ported to the site.

The giant, four-story facility willallow Chevron to meet Angolan en-vironmental regulations that requirethe reduction of gas-flaring, and willalso help contribute to the econom-ic development of the country byproviding another energy source, aswell as export revenue.

Chevron and its partners in An-gola are already a major funder ofsuch programs in Cabinda and therest of the country, placing a par-ticular emphasis on combating il-literacy and improving health care.

The commitment to reducing emis-sions produced by flaring, and to us-ing the natural gas from the wellsmore productively, won’t come cheap-ly. In January Chevron said it wouldspend $2.3 billion over the next fiveyears on the program.

Most of the oil and gas extract-ed from Cabinda’s offshore waterscomes from deposits under morethan 1,000 feet of water. In Augustof last year Chevron announced ithad found oil and gas in a depositcloser to the coast, in water about400 feet deep.

The deposit will be much easierand cheaper to exploit than fields indeeper water, which require expen-sive platforms and support struc-tures. The shallow-water oil and gascan be extracted with equipmentthat doesn’t require such infra-structure and can then be piped di-rectly back to the shore.

Capturing rather than releasingLNG is just one of the petroleum products that is leaving its mark in Cabinda

NATURAL GAS

The rapid economic growth in thepast decade in countries such asChina, India and Brazil has led toan ever-increasing demand formore energy, which in turn hasspurred more and more investmentin the exploration for new oil de-posits, and in finding more efficientways to exploit currently devel-oped deposits.

Angola, and Cabinda, have wel-comed this flow of investment in-to the oil industry, and are doingall they can to encourage more.Many different companies, in-cluding Chevron, Total, ENI, Plus-petrol International, ROC, and An-gola’s state-owned Sonangol are ea-ger to take up the challenge andfind more oil.

Cabinda’s local governmentkeeps 10% of the income from lo-cal production to help fund its ownprojects, with the remainder goingto the central government. Thatmeans that the more oil that com-panies can extract and export, thebetter for Angolans and Cabin-dans, who benefit from programsto build up the infrastructure andimprove the health and educationof the province’s population.

Chevron Corp. of the U.S. is thebiggest foreign oil producer oper-ating in Cabinda. Its local unit,Cabinda Gulf Oil Company, or CAB-GOC, has a 31% share in Block 14production and a 39% stake in BlockZero. The two blocks currently pro-duce the bulk of Cabinda’s oil.

Production from Block 14, oneof Cabinda’s most important de-posits, is scheduled to increase inthe next few years. While daily pro-duction levels at the Kuito field isdeclining, output from the Benguela,Belize, Lobito, Tomboco project(BBLT) probably peaked in 2008.

The Tombua Landana project, a$3.8 billion oil production platformwithin Block 14 that included theconstruction of one of the tallestman-made structures on the plan-et, started production in Septemberof last year and is expected to reachpeak production of 100,000 barrelsof oil per day in 2011.

In July 2009, Chevron announcedthat the company and its partnershad started crude production aheadof schedule at the Mafumeira Norteproject, within Block Zero. The pro-ject is expected to reach its maxi-mum production of 30,000 barrelsof crude and 30 million cubic feetof natural gas per day some timenext year.

Chevron also continues to prospectfor new fields to develop in Cabin-da’s offshore blocks. In August oflast year the U.S. oil company an-nounced that it had made anothersuccessful discovery in Block Zero,which Chevron co-owns with So-nangol (41%), France’s Total (10%)and Italian oil company ENI (9.8%).

Much of the oil already producedin Cabinda is exported throughChevron’s Malongo terminal, alargely self-sufficient encampmenton the coast whose loading termi-

nal can accommodate Very LargeCrude Carriers (VLCCs). The VL-CCs can hold as much as 950,000barrels of crude oil.

Chevron is in fact one of thebiggest oil producers in all of An-gola, with a total daily productionof more than 171,000 barrels of oil.It’s the country’s biggest foreignoil-industry employer, with about2,700 Angolans on the staff, orabout 87% of the local company’stotal workforce. Angolans make up75% of Chevron’s professional andsupervisory staff in thecountry.

While Chevron hasbeen present in Ango-la for decades, the ar-rival of stability in thecountry with the sign-ing of the 2002 and2006 peace pacts hasattracted more foreigncompanies to the areato seek out promisingnew deposits.

Almost all of the oilproduced in Cabindacomes from its offshore wells. Thatproduction represents approxi-mately half of Angola’s total oil out-put of about 1.85 million barrelsper day, and has helped make thecountry one of Africa’s top threeoil producers. After the 2006 agree-ment with Cabindan separatistmovements, oil prospectors havestarted scouring the province foronshore deposits that can be ex-ploited.

The Lower Congo Basin, whereCabinda is located, has long beenknown to be rich in petroleum re-sources, and the prospecting car-ried out so far has shown the on-

shore area to have great potentialfor development.

ROC Oil of Australia began ex-ploration in the Cabinda South blockin 2005, and its efforts have alreadybeen greatly rewarded. One field,known as Massambala-1, was esti-mated in 2008 to contain 170 mil-lion barrels of oil, more than fivetimes the amount originally thought.

ROC, through its wholly ownedsubsidiary Lacula Oil Company Ltd.,announced in November of last yearthat it had started drilling explo-

ration wells in the Cas-tanha-1 and Coco-1fields. Castanha-1 wasthe first explorationwell in ROC’s 2009drilling program in theCabinda South block.

The Cabinda Southblock includes the Mas-sambala field and oth-ers, including Coco,Milho, Cevada and So-ja, which mean coconut,corn, barley and soy inPortuguese.

ROC, who originally owned a60% interest in the Cabinda Southblock, last year agreed to farm outa 45% stake to Pluspetrol AngolaCorp., a Houston, Texas-based com-pany, which then took over as op-erator. ROC then farmed out another5% stake to Cuba Petroleo, leav-ing the Aussie company with a 10%interest in the block.

The entire block is located with-in 31 miles of Chevron’s Malon-go terminal, which will make iteasier to export its oil once pro-duction starts.

Cabinda’s people stand to gainfrom the increase in onshore ex-

ploration, as well as from the pro-duction offshore, as programs tohire more workers from the regionbenefit the province’s economy,and as the decline of civil strifepermits expatriate workers to mixwith the locals and further add togrowth.

Chevron has long been activein helping the community inCabinda and the rest of Angolain many ways, not just by pro-viding thousands of well-paidjobs, but also by helping reducepoverty and spur economic growthin other ways as well.

The Angola Partnership initiative,a cooperative effort launched in2002 to promote peace and stabilityand improve the country’s educa-tion and health care infrastructure,set up a micro lending bank in 2004,called NovoBanco.

Since opening, NovoBanco hasgranted more than $27 million ofloans to more than 5,500 micro-and small enterprises. Another partof the initiative has provided seeds,tools and food to approximatelytwo million people spread across sixprovinces.

Chevron expects to invest an ad-ditional $2.5 million each yearthrough 2012 in programs that areintended to help make local gov-ernments more efficient by im-proving their organizational andadministrative skills, and to fur-ther reduce poverty by encourag-ing the growth of small- and medi-um-sized businesses.

All of the exploration anddrilling activity, as well as theprograms funded by Chevron, itspartners, and the local and na-tional governments, are adding to

Outside investment rolls into Cabinda as scale of production risesFrom oil processingto construction,global companies aresetting up shop inCabinda thanks toits tax incentivesand labor force

Companies look tomaintain the spiritof Angola in their oiland gas operations

OIL PRODUCTION

the amount of money invested inCabinda each year.

That inflow means more directjobs for Angolans and Cabindanswho are hired to build the struc-tures needed to explore and produceoil, and for the people who benefitfrom the spending that will resultfrom more locals having more mon-ey in their pockets.

So even as big multinational cor-porations such as Chevron, Total andPluspetrol gain from Cabinda’sabundant petroleum resources,Cabinda’s residents will also di-rectly gain from the new jobs cre-ated by the projects, and indirect-ly from the money that will flow in-to government coffers.

As investment flows into the country, namely from oil companies, more and more projects can be seen in Cabinda

The government is conscious of employing techniques that will capturenatural gas and minimize the environmental impact

Companies in the province areconstantly researching and de-veloping new extraction methods

Cabinda’soffshore wellsare responsiblefor a large partof the 1.85million bpdthat Angolaproduces

Production inCabindareached newlevels in 2009,thanks to the newextractiontools

Adaptingthecountry’soil & gas industry

JOBS & BUSINESS

CABINDA WSJ 8 pages (2).qxd 11/6/10 13:55 Página 3

Cabinda’s government has an am-bitious plan to make Cabinda Citya transport and trade hub for theregion. Part of that plan includesthe rebuilding and expansion ofthe seaport. The port received a$100 million grant from the na-tional government in 2007 to fundthe project.

As part of the plan, the port hasbeen given a deeper maneuveringbasin to permit ships with a load-ing capacity of more than 1,000tons to use the facility, and a wideraccess channel so that two shipsmay pass at the same time.

Since new management tookover the port in 2004, there hasalso been a concerted effort torenovate and modernize its equip-ment to make it cheaper and morecompetitive with other ports andforms of transportation.

The new management, whichwas led by the former port di-rector general Osvaldo Lobo doNascimento, didn’t just renovatethe facility’s physical side, though.The port’s operators have alsoworked to improve its adminis-tration, legal set-up, and its mar-keting to gain more business.

The port’s equipment and phys-ical state, including its contain-er-moving cranes and its pier, weredeteriorated and needed muchrenovation to bring them up tomodern standards. That work iswell advanced, and should be fin-

ished within the next year. Thepier, when finished, will have ca-pacity to handle five 12,000-tonships at the same time. Five newcranes have been purchased thatcan stack containers higher thanpreviously possible at the port,which will instantly increase stor-age capacity, while also allowingfaster and nimbler movement ofcontainers.

The port already has a group ofworkers who know how to operatethe new loading cranes, which havebeen named after former workersat the port who have contributedoutstanding work, and a trainingprogram will increase the numberof operators.

The port’s cargo holding areais being enlarged, which will fur-ther increase its storage capaci-ty. Cement silos and flour silosare being built in the holding areato add to the type of products thatcan be efficiently moved throughthe facility.

The holding area and piers willalso benefit from the construc-tion of a new electric network thatwill provide power to the wholearea, and the addition of an in-tranet communications network,all of which will further increaseproductivity and efficiency.

A properly functioning portrequires more than just modernequipment, of course. Efficientadministration is also necessary,and do Nascimento and his teamdidn’t ignore that area. Theyhired new people, increasedworker training, and changedthe port’s legal structure as partof their strategic plan. They al-so developed a marketing planintended to attract more businessfrom areas near Cabinda.

Cabinda has long faced difficultiesbecause of its distance from therest of Angola, with ferries actingas the principle mode of trans-portation for most people travelingbetween the enclave and the near-est part of the rest of the country,which is the city of Soyo.

Angola’s central government hascontributed to the efforts to improvetransportation between Cabindaand other parts of the country bybuying a new ferry called the Ebo,which is already speeding up thetrip.

The new ship’s turbine enginesgive it a maximum speed of 42knots, which permit it to make thetrip between Cabinda City and Soyo,in Angola’s Zaire province, in onehour, instead of the three hours thatthe previous ship on that route took.The travel time between Cabindaand the national capital of Luan-da has been reduced to six hours,from 15 hours previously.

The Ebo is a much larger shipthan the Lueji, which was the fer-

ry on the route before. The Ebo is154 feet long and 42 feet wide. Itcan carry 370 people and cargo.The Lueji had capacity to carry just96 people.

“The Ebo is a modern, high-speed ship,” says João Pedro Paxe,captain of the new ship. “Our pop-ulation is used to carrying mer-chandise with them when they trav-el, and it’s always easier to takemore weight on a ship than on aplane. So when the Ebo starts op-erating, it will more than meet thoseneeds.”

The Ebo has two classes for trav-elers, economy and executive. Thetrip between Cabinda City and Soyocosts 2,000 kwanzas ($22) in econ-omy class, and 3,000 kwanzas($33) in executive class. The tripto Luanda costs 4,500 kwanzas($50) in economic and 6,000 kwan-zas ($66) in executive. The shipwas bought in Italy by Angola’sMinistry of Transport, and the pur-chase price included a maintenancecontract.

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Cabinda

The Port of Cabinda is an important gateway to the rest of Africa

Modernizing thePort of Cabinda Shipping importsand exports aremoving moreefficiently throughthe province

PORTS

BY SEA

The new ferry will bringCabinda closer to Angola

Cabinda is separated from therest of Angola by the Zaire Riv-er and a narrow strip of the De-mocratic Republic of Congo.That separation has left theprovince isolated from the restof the country, but within a fewyears the problem will be solvedby a new bridge.

An audacious project to bringCabinda closer to Angola willbuild a $2.55 billion bridge androadway to link the two areasby land. The bridge over theZaire River will be about 12miles long, and a stretch ofhighway will complete the con-nection. Construction on thebridge began in 2008 and isexpected to be completed in Oc-tober, 2012.

The bridge is part of a big-ger government program that,when finished, will leave all ofAngola with a much improvedtransportation network.

Angolan and Cabindan offi-cials held meetings with their

counterparts from the Democ-ratic Republic of Congo, whichseparates the two parts of An-gola, to decide on the best routeand the best combination ofbridge/causeway/roadway tobenefit the residents of the areain both countries.

Once a final decision on theproject’s parameters is made,a Chinese construction compa-ny, the China Road and BridgeCorporation, will start theprocess of building the road-way.

The government isn’t ne-glecting local roads in Cabin-da, of course. Hundreds ofmiles of roadways have beenbuilt, rebuilt and improved inrecent years, with more activ-ity planned. The final goal isto give the province a localroad network that will link itstowns and smaller villages toCabinda City, and to the bridgethat will join them to the restof Angola.

A country’s infrastructure is ab-solutely vital to its economic success,and the governments of Cabinda andAngola, are well aware of this. Bothhave dedicated huge efforts and am-ple resources to building up the coun-try’s roads, airports, ports and oth-er important networks.

Those areas are among the gov-ernments’ priorities, but health, ed-ucation, energy, water and telecom-munications infrastructures are al-

so being transformed by investment.The objective is to give residents ofthe region a higher quality of life bygiving them easier access to cleanwater, improving their health throughthe construction and renovation ofsewage systems and helping peopleand businesses go about their dailylives by reducing transport andtelecommunications times and costs.

The provincial and national gov-ernments are working on numerous

projects that will increase theprovince’s electrical supply, and ex-tend it further from Cabinda City in-to the rest of the region. The projectwill use Cabinda’s energy resourcesto provide residents with more elec-tricity. Power production has alreadyincreased, from 4MW at the startof the project, to 42MW today.

Two recently purchased gas tur-bines are in the final stages of be-ing installed, which will take ad-

vantage of the natural gas that is ex-tracted along with Cabinda’s oil.Taken together, the different pro-jects will have a great impact on theprovince’s residents and businessesby increasing the amount of energyavailable to them.

A recently announced energy pro-ject, which could be completed in aslittle as two years, would link Cabin-da’s energy grid to the Inga Dam inthe Democratic Republic of Congo

(DRC). The proposed power linewould give the province anothersource of electricity, making thepower supply more dependable.

Another project intended to helpresidents and businesses will linkCabinda, which is cut off from main-land Angola by the DRC, with therest of the country via a 12.4-mileroad that will include a bridge overthe Zaire River. The road and bridgewill cost an estimated $2.55 billion

and will connect Cabinda to the townof Soyo, in Zaire province.

Transport to Soyo and the na-tional capital of Luanda have al-ready improved. A new, faster fer-ry has begun operation, cuttingtravel times from Cabinda to Soyoto one hour from three, and to Lu-anda from 15 hours to six. The newship can carry almost four times asmany people as previously fit on theold ferry.

BY LAND

Bridge to Province of Zaireprovides link to mainland

Cabinda’s government has beenworking to improve the province’seconomy by focusing on improv-ing its transportation infrastruc-ture. The international airport,where renovations are now com-plete, is an excellent example ofhow those efforts are already hav-ing a positive effect on people andbusinesses.

Travelers to Cabinda can nowchoose from several scheduled dai-ly flights to Luanda, Angola’s cap-ital, on the country’s national car-rier, TAAG, which flies to other in-ternational destinations as well.Another option would be to arrangefor a charter flight to and from theairport with a private company.

The renovations to the facilitywere finished in 2007, leavingCabinda with Angola’s secondbiggest airport and a 1.5-mile-long runway, capable of handlingplanes as large as a Boeing 737.

The airport’s waiting room hasbeen enlarged to handle up to 300passengers at peak hours, and bag-

gage-handling equipment has beenmodernized as well, helping makepassengers’ transit through the fa-cility faster and more comfortable.

New equipment has been in-stalled in the control tower and insecurity areas, making travelingfrom the airport safer. Officialsfrom the International Civil Avi-ation Organization agree. Theyhave inspected the airport, andgiven a positive opinion of the im-provements.

One of the most recent im-provements is the renovation ofthe airport’s meteorological, com-pleted in early May of this year.Pilots now receive more accuratedata on weather conditions throughCabinda Airport’s air traffic con-trol tower.

The airport is a big employer inCabinda, providing about 60 di-rect jobs and about 270 indirectpositions. There are already plansafoot for more enlargements andimprovements, which would meaneven more work for Cabindans.

BY AIR

Cabinda renovatesits airport

Linking Cabinda to AngolaThe enclave is strengthening its ties to the mainland thanks to a variety of new infrastructure linkages

NEW CONNECTIONS

Huge investments have been made in upgrading road infrastructure, in addition to water supply, the airport and telecommunications

Cabinda’s infrastructure had beenneglected for so long during the pe-riod of civil strife and separatismthat when peace returned to theprovince in 2006, the governmenthad to spread its efforts to im-prove the lives of its residentsaround many different projects.

Over the next few years the peo-ple of Cabinda will enjoy a hugeimprovement in the various dif-ferent parts of the province’s in-frastructure as the government in-vests more and more on roads,new buses, a new ferry, water andsanitation.

The work on the port and the air-port and plans to build a bridge tothe rest of Angola are detailed inarticles below, but the governmentis improving much more than thosevital networks. For example, com-munications between Cabinda andthe rest of Angola have long beena problem for the province, whichis located about 124 miles from thecountry’s capital.

The national government isworking to resolve those difficul-

ties by installing a new system ofsatellite communications that linkstogether the widespread regionsof the country and permits fastertransmission of voice, internet, da-ta, television and radio. The provin-cial government has already tak-en great strides to im-prove its own com-munications with therest of the world.

Work has recentlyfinished on a subma-rine cable that willvastly improve Cabin-da’s connection to therest of the world. Theend result is a mod-ern telecommunica-tions infrastructurethat is the envy ofmany countries in the region.

Helping Cabindans get aroundthe province more easily is an-other priority. The province is al-ready much more than halfwaythrough a $190 million project toimprove 170 miles of roads con-necting the provincial capital of

Cabinda City to other parts of theenclave and to the frontier withthe Democratic Republic of Con-go (DRC).

The provincial government hasimported 152 new buses to take ad-vantage of the new roads and im-

prove connections be-tween Cabinda City andother parts of the area.The new vehicles aremaking travel withinthe province quicker,cheaper and easier forresidents and visitorsalike.

Cabinda already hasa new airport, whichhas been operating formore than two years.The facility has a 1.5-

mile runway that can accommo-date planes of all sizes, and now han-dles more than 100 takeoff/landingoperations a day.

The port of Cabinda has alsobenefited from several improve-ments. A $100-million expansionplan includes a 29.5-foot-deep

maneuvering basin and a 262-foot access channel that will al-low ships carrying over 1,000 tonsof cargo to use the port. The newfacilities will permit increased useof the port and provide new em-ployment opportunities.

Another hugely important pro-ject has been the improvementand expansion of Cabinda’s wa-ter supply network. Residents ofcountries with modern, normal-ly functioning water systems can’tfathom the amount of time andenergy that is used in seeking outand carrying fresh water fromits source to the home, for cook-ing, cleaning and other forms ofsanitation. The water projectalone will vastly improve resi-dents’ lives.

The province has already madelarge and effective investments toimprove the water system, whichhave increased Cabinda’s supplycapacity from 120 cubic metersof the vital liquid per hour in 2002to more than 990 cubic meters perhour today.

Boosting the economy throughimproved infrastructureBridges and roads get special attention as the province invests nearly $100 million

INFRASTRUCTURE

The province isimproving 170miles of roadsconnecting thecapital ofCabinda toother regions

CABINDA WSJ 8 pages (2).qxd 11/6/10 13:55 Página 4

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Cabinda

Cabinda’s oil resources are a sourceof great wealth for the province andfor the entire country, providingfunds that are being used to buildschools, hospitals, roads and otherinfrastructure that have already vast-ly improved the lives of Angolans.

The economy is highly dependenton the petroleum industry, though,and that needs to change in order toreduce the country’s reliance on onesector and to promote the creationof new jobs. The provincial and cen-tral governments both recognize theneed for more diversity in the econ-omy, and are working to spur de-velopment and investment in othersectors.

One area that has already receiveda lot of attention is agriculture.Cabinda’s farmers and the provin-cial government are working to-gether to help boost agriculturalproduction with two goals in mind.One is to increase farm employment,and help create new jobs in relatedsectors, and the other is to providethe region with enough of the basicfoods that are the staples of the lo-cal diet.

Within Cabinda’s natural re-sources, there lies much potential –and interest – in developing cerealcultivation, soy, fishing and fruit.

The goals for agricultural pro-duction have been rising each year,with the objective for the 2007/2008farming campaign increased to48,592 tons of foods – including ba-nanas, corn, peanuts, mandioca, ma-cunde beans and sweetpotatoes – from the37,498 tons producedin the previous year’sharvest.

Earlier efforts toboost output have al-ready helped, andCabinda now producessurpluses of mandioca,banana and ginguba,which are exported. Theregion is also self-suf-ficient in peanut pro-duction, and all the pos-itive results are the fruitof the success of government pro-grams to encourage their cultivation.

The production of mandioca is aspecial success because the plantwas nearly wiped out in recent yearsby disease. The government helpedintroduce new varieties of the plant,enabling the gratifying comebackof the crop.

The government reaches out tohelp farmers in the rural parts of thecountry through Agrarian Develop-ment Stations, which offer techni-cal advice on how to increase pro-duction and improve the quality ofcrops. Cabinda has four of the newstations, spread around the provinceto make sure they’re as close to thefarmers as possible.

The new stations cost 11m kwan-zas ($122,500) to build and equip,and each has a warehouse to hold

equipment, seeds, fertilizer and oth-er items. The region is working toproduce other crops, some for localconsumption and some for export.

Cabinda already grows pineap-ples for export, though increasingsuch exports is difficult at the mo-ment because of a lack of transportinfrastructure. A better strategy nowis to produce vegetables for the near-by Chevron oil camp at Malongo.

In 2008, the camp bought pro-duce worth $400,000, and that fig-ure can be increased as more regu-lar production and delivery arrange-ments are made. The regional gov-ernment is buying greenhouses, andhas sent a technician to Brazil tolearn their greenhouse productiontechniques to help with this effort.A liquefied natural gas plant that isunder construction in the nearbyprovince of Zaire will also boost de-mand for local produce once it hasbeen finished and staffed.

The local and national govern-ments have several different pro-grams to help farmers increase pro-duction. The national government hasfor years provided farmers through-out the country with micro creditsto help them acquire equipment andseeds, and the local government re-cently started a similar program forCabinda’s coffee farmers. Since2007, more than 22,000 farmersfrom around the country have formedcooperatives to benefit from micro-credit programs.

The programs lend between$100 and $1,500 tothe cooperatives,which consist of atleast seven farmerseach. Over $6 millionhas been lent so farto buy farming equip-ment, of which morethan $700,000 hasalready been repaid.

The program hasbeen extended to allthe provinces in An-gola, with about1,078 Cabindanfarmers involved.

Another project sponsored bythe government is importing cat-tle into the province. In Octo-ber of 2008, 1,000 head of cat-tle arrived in the region from theDemocratic Republic of Congo,and more were imported in2009, boosting the total num-ber of cattle in Cabinda to morethan 2,400.

A previous attempt to intro-duce more cattle to the regionwas unsuccessful because theanimals came from southern An-gola, where the climactic con-ditions are different from inCabinda. The Congolese cattleare expected to fare better be-cause they’re more accustomedto the local weather.

Now that Cabinda is close toproducing enough food for the

local population, other agricul-tural projects are starting. Con-struction of a palm oil refiningand bottling plant has alreadybegun, and oil palm trees havebeen planted to provide supplies.

Angola’s central government isworking on several fronts to boostthe country’s fishing catch as well,to help people become more self-sufficient in their food supply.

In Cabinda that has meant thedonation of 20 boats in recentyears to fishing cooperatives inthe province, many sent from Chi-na, along with other equipmentincluding 25 stern engines, 12central engines, 17 canoes andlarge numbers of nets.

The local fishermen are limit-ed in where they can fish becauseof the prevalence of oil platformsoff Cabinda’s coast. The govern-ment gave the cooperatives theboats and engines so they couldtravel farther and carry more fish.

Now the supply of fish isgreater than a few years ago be-cause the new boats can carryfour or five tons of fish. Cabin-dan fisherman have also bene-fited from the opening of twoice factories, one in Cabinda Cityand the other in Cacongo, aswell as from a series of enginerepair shops that are being builtalong the coast to help boatssuffering from mechanical dif-ficulties. The delivery of canoesand fishing nets has also helpedincrease the province’s fishingcatch by permitting fishermen inCabinda’s interior to exploit theprovince’s rivers and lakes.

The development of a non-oil based economy Sectors such as timber and agriculture aregetting a boost from government subsidies

DIVERSIFICATION

Cabinda’s crops include surplusses of mandioca, banana, inguba, pineapples, peanuts, corn, macunde beans and sweet potatoes

The government is promoting the sustainable development of timber

A critical mass of services andinfrastructures are often need-ed to spark economic growth.One tool that many cities,provinces and countries haveused to provide the necessarycatalysts for expansion is theestablishment of industrialparks that group these neces-sary services all together in oneplace.

Cabinda’s small but growingindustrial sector is set to gainan important facility within afew years when the construc-tion of the first phase of the Fu-tila Industrial Park, locatedabout 21 miles north of Cabin-da City, is fully completed.

The park is expected to at-tract factories that will helpreduce Cabinda’s dependenceon imported goods, while atthe same time create goodjobs and spur job trainingprograms for local residents.The first phase is expectedto create 2,000 new positionsand attract more than 60companies.

The plan to build the parkwas first hatched more than tenyears ago, though the fundingfor the $40 million first phaseonly materialized last year.The national government andthe provincial government areboth contributing to the am-bitious project.

The work of clearing about272 acres of land for the firstphase has been completed;much of the cleared land hasbeen leveled and prepared forthe final stage, which is con-struction of infrastructure andbuildings. Some work has al-ready begun in those areas.

The project is off to a goodstart and construction shouldbe finished in less than threeyears.

The plan is for companies inconstruction supply and foodprocessing to be among thefirst businesses to occupy thenew park. The governmenthopes to see sawmills, brickand tile makers, plastics com-panies and cement makers inthe first wave of companies.

The goal is for those busi-nesses to make an immediateimpact on Cabinda’s economyby supplying basic necessitiesto residents and much-need-ed supplies for the boomingconstruction industry in the re-gion, and around the entirecountry.

In later phases, chemicalcompanies and other busi-nesses tied to Cabinda’s pe-troleum industry are expect-ed to make use of Futila’s fa-cilities. The site, which isplanned to eventually expandto occupy 5,795 acres, waschosen partly because of itsproximity to Chevron Corpo-ration’s Malongo oil camp.

Creating a basefor newindustries, theprovincialgovernment islooking to beginwith buildingmaterials and foodprocessing

FutilaIndustrialPark getsfirst-phasefunding

INDUSTRY

Millions ofdollars in micro-creditprograms havehelped farmersbuy muchneeded farmingequipment

Timber is Cabinda’s second-biggest industry after oil. Thesector suffered years of neglectas a result of the civil turmoilthat took place in the provinceuntil just a few years ago. Today,however, the government andprivate banks are lending to com-panies in the sector to increaseproduction.

Angola’s rapidly growing econ-omy, which expanded at a realpace of about 1.3% in 2009, ayear of economic crisis and re-cessions in most countries aroundthe world, has spurred demandfor wood amid a years-long re-

construction program followingthe end in 2002 of the civil war.

Angola and its former colonialruler, Portugal, have an agreementto help promote the African coun-try’s timber industry, with a spe-cial emphasis on Cabinda. Ac-cording to the terms of the agree-ment, the province will become animportant source of timber for therest of Angola.

Along these lines, the Banco deDesenvolvimento de Angola, or BDA,a state-owned lender set up in 2006to help finance private businesses,has been active in lending money tocompanies involved in Cabinda’stimber industry, to help them buyequipment including saws and oth-er wood-working machinery.

The new equipment means localcompanies can increase output at thesame time that they add more val-ue to Cabinda’s wood production,keeping more of the profit within theprovince. More investment in equip-ment is needed still in order to meet

the requirements of a recent lawthat stipulates that exported woodproducts must undergo at least someprocessing within the country.

In the case of Cabinda, a furtherstipulation must be met. Any in-vesting in the province’s timber sec-tor must also be done under condi-tions that ensure that the produc-tion of wood from the region is sus-tainable. This forms part of a pub-lic program to encourage the growthof the lumber industry, in which theprovincial government is boostingefforts to improve the health ofCabinda’s forests.

Areas that had previously been de-forested are being replanted, oftenwith eucalyptus trees. Eucalyptus isa fast-growing plant, so it will helpto quickly replenish the province’sstock of trees. New plantations nearCabinda City are growing a varietyof eucalyptus that is better suited tothe local climate, after previous ef-forts with trees from the southernpart of Angola were unsuccessful.

Expanding Cabinda’s number two industry After years ofneglect , the timbersector is back in thespotlight as banksincrease lending

TIMBER

Cabinda’s provincial government isnot content to simply live off its oilwealth. The local administration andthe national government are eagerto encourage investment in otherpromising industries, so that morenew jobs will be created and theeconomy can continue to grow.

The National Agency for PrivateInvestment has established variousincentives for investment that arecomplemented by local programs. In-vestors can win land grants, subsi-dies and pay low prices on some ser-vices that make it easier to startprojects up, and help make themprofitably more quickly.

Cabinda has taken other steps aswell, such as promoting the Futila

Industrial Park, where constructionwork has already begun to provideoffices, warehouse space, and all themodern infrastructure needed bybusinesses. The goal is for the firstcompanies that open there to be inthe construction materials sector,to provide the necessary supplies forthe building boom.

The construction-supply industryis one that has been growing in re-cent years here, helped by financingfrom public and private banks. In-stitutions such as the state-owned An-gola Development Bank, or BDA, arelending money to sawmills, brickmakers and other companies.

Other projects that have either al-ready begun, or are in the process ofgaining the necessary backers in-clude setting up a palm plantation,along with a processing and bottlingplant to sell the oil produced by thetrees, and other types of vegetableoils, too. A soap factory is anotherproject that has won financing.

Among the most important stepstoward industrial development havebeen the improvements made toCabinda’s transport, energy andcommunications infrastructure, with-out which no modern business canthrive. Cabinda now has moderntelecommunications links to the restof the world and an improved wa-ter supply system.

Roads, the port and the airporthave all been refurbished, and thesupply of electricity has risen. Withplans to further boost electrical out-put, the province has great poten-tial to become a regional renewableenergy exporter even without count-ing on its oil and gas resources.

For example, Cabinda is crossedby several rivers, giving it tremen-dous potential for hydroelectric gen-eration. The province also boastsfertile land that can be used to growsugar cane that can be transformedinto biofuel, a possibility that is al-ready being studied.

Taking advantage of Cabinda’s eagerness for growthA variety of newprojects are up andrunning, thanks togovernment loans

INDUSTRIAL DEVELOPMENT

Skilled technical workers are in high demand in many growing industries

Greater investment in agriculture also means greater variety of crops

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Cabinda

The Cabindan government hasbeen dedicating more and morefunding to improving theprovince’s health care system.New hospital and health cen-ters are being opened aroundthe country, some of them withadvanced medical equipment.The new facilities can spare peo-ple from the region a trip to thenational capital of Luanda, orfurther, for many treatments.

In addition to renovatingCabinda’s Central Hospital andopening a municipal hospital,the government is now finishingwork on the Alzira Fonseca re-gional hospital, which boastsstate-of-the-art technology fromGeneral Electric. The new equip-ment permits the facility to car-ry out cardiovascular, kidney,

and diabetes treatments, as wellas other procedures.

As in other areas, the region’schildren are a special focus ofthe increased spending. A vac-cination program begun in 2007has inoculated more than130,000 children against po-lio. The kids also receive a vit-amin A supplement and an an-ti-parasite medicine while get-ting their shots.

A program administered joint-ly by the education and healthdepartments has treated morethan 100,000 school childrenbetween the ages of five and 14for parasites over the past twoyears. Last year alone, the pro-gram treated 87,000 kids. Thechildren receive a drug calledAlbendazol, which will help ridthem of the pests that can grave-ly affect their health and theirability to learn.

The government has begun toacquire mobile health care clin-ics that also help improve thehealth of the region’s youngestresidents. The units travel fromschool to school to do check-

ups, diagnose illnesses, and aidin the prevention of malaria andparasites.

Another program to vaccinatepeople of all ages against polioand malaria, and sponsored byChevron, is aimed at residents ofthe region’s rural areas. Drugsare administered by mobile clin-ics to make it easier to reach themost isolated residents.

The rest of the population isalso benefiting from the increasein spending, of course. In addi-

tion to the new hospital, an old-er hospital has been renovatedand new clinics are being openedup around the province that willbring doctors and treatment clos-er to all Cabindans.

The 40-bed hospital at Cacon-go has been completely renovat-ed and provided with new equip-ment. With a staff of five doctorsand 32 nurses, the hospital spe-cializes in pediatrics and mater-nity care, as well as general med-icine and AIDS treatment.

New clinics have also beenopened in the Massabi and San-ga Planicie areas. The Massabifacility has 25 beds, and cancarry out clinical analyses thatwere not previously available inthe area. The people of SangaPlanicie have gained a facilitywith a maternity ward and avaccination clinic that will im-prove the health and the lives ofthe local population.

One indication of the im-provement in health care in re-

cent years is the fact that nonew cases of leprosy have beenreported since 2005. Coordina-tor for public health in the re-gional government, Fuete Hen-ry da Costa, says the success ofthe region’s leprosy program canbe attributed to the residents ofthe region taking advantage ofall the new health care facilitiesbeing offered. The region’s lep-rosy program currently manages35 outpatients who suffer fromthe disease.

Mobile health carereaching everyone

HEALTH

A well educated and trained popu-lation is one of the most importantingredients in any country’s eco-nomic success. Educated workersare more productive, commandhigher salaries and contribute moreby paying more taxes. Business al-so gains from having a skilled work-force. The more workers a compa-ny can hire locally for a project, thebetter. Local hires will usually spendmore of their money within the com-munity, spreading the wealth aroundto their neighbors.

Local hires are also cheaper forbusinesses, because importing work-ers means a company has to payfor transport, help out with hous-ing, and spend more on many oth-er things related to moving from onecountry to another.

Angola’s central governmentand provincial governments areworking to make sure that po-tential investors will have as bigand skilled a local labor marketas possible from which to hire em-ployees. They understand thatwithout a qualified pool of labor,companies have to invest more infinding, training or importingworkers, raising the start-up costof any new projects.

The governments are funding theopening of a series of professionaland technical training schools. Asthese open, the country begins togain a larger, skilled corps of work-ers that enables foreign companiesto hire Angolans, rather than im-port workers from abroad.

One example of this kind of ef-fort was a national training pro-gram for tour guides, bartendersand receptionists to prepareskilled service workers ahead ofthe African Football Cup of Na-tions, or CAN2010, which An-gola hosted this past January.The Angolan government and theWorld Tourism Organization joint-ly organized the program, andtraining sessions were run in Lu-anda, Benguela, Lubango andCabinda City, the four cities wherematches were held during thetournament.

A technical school that openedlast year in the province of Cabin-

da to train oil workers has had thedirect cooperation of Sonangol, thestate-owned petroleum company,on developing its curriculum. Theschool has courses in engineeringand chemistry, and other areas thatwill be useful to Sonangol and oth-er oil companies.

Another school opened in 2009in Chiazi, a town 7.5 miles north

of Cabinda City. That facility is partof a nationwide program that willeventually open 21 technical schoolsaround the country.

The facility in Chiazi will have17 classrooms, each one with thecapacity for 36 students. The schoolwill have workshops, laboratories,boarding facilities for 200 students,and residences for 10 teachers andfor the school’s director.

The training centers in Cabin-da have had great success in turn-ing out students with the skillsneeded by the oil companies andby other businesses, as well. De-

mand for trained workers is sostrong that many students startreceiving job offers before they’veeven finished their courses. Mostof them go on to receive theirfirst jobs, often as mid-level tech-nical workers, through the train-ing centers.

Some of the vocational train-ing programs are part of an agree-ment the government signed lastyear with RKK, a Norwegian or-ganization that organizes suchprograms in many parts of theworld. The $11 million contractextends through 2012, and in-

cludes plans to develop sustainablevocational training centers aroundthe country, instructor trainingand specialized training for oil in-dustry workers.

The government is also pushingother companies to get in on theact. In March of this year, Nar-ciso Benedito, the Deputy Minis-ter of Education, said industrialcompanies will in some cases haveto provide their employees with on-the-job training. The goal is tohelp give even more Angolans theopportunity to learn important,job-related skills.

The government has of courseinvested heavily in improving theeducational system for the youngestAngolans. New schools have beenbuilt all around the country, teach-ers’ pay has risen, and the budgetfor teacher training has also beenincreased. All these measures haveled to higher enrollment of the coun-try’s children in schools, and ris-ing levels of literacy.

In 2002, there were 1.7 millionchildren enrolled in the country’sschools. By 2008 the figure hadrisen to 5.7 million, and is esti-mated to have climbed to 6 millionfor the 2009 academic year. Overthe same period, the number ofclassrooms has risen by about 18%each year, though more are stillneeded.

Despite all the progress made inrecent years, the government is stilldedicated to making further im-provements. Last year, the Educa-tion Ministry signed an agreementwith UNICEF to start a programthat will train 8,750 primary schoolteachers over about three years.The European Commission com-mitted to contributing $5.4 mil-lion to the program, and UNICEFcommitted to providing another$1.3 million.

The government’s efforts aren’tlimited to educating children andfinding work for young people.After Angola’s long civil conflict,the country has many former sol-diers with disabilities that thegovernment is working to re-in-tegrate into civil society. The Na-tional Association of AngoleseHandicapped, or ANDA, has es-tablished various programs thatare providing work for this groupof people.

ANDA, which in Portuguesemeans both ‘work’ and ‘walk’, hasopened workshops around thecountry that are providing jobs tohundreds of people. One workshopin Cabinda is equipped with ninesewing machines, including an in-dustrial sewing machine that isbeing used to make shirts andAfrican-style clothing for women.

ANDA also does other goodwork around the country. Thegroup has orthopedic centers inseveral cities in Angola that havehelped more than 500 victims ofland mines to gain medical at-tention and help them reintegrateinto the labor market.

Entering the professional world An eager new generation of Cabindans isgetting equipped for the enclave’sindustries

JOB TRAINING

The education system in Cabin-da has undergone extensivechanges and improvements sincethe end of the strife in the re-gion. More children are inschool, more classrooms are be-ing built and teachers are beingbetter trained and better paid.

The government recognizesthe importance to the country’sfuture and its economy of im-proving the education systemfurther on all levels, and is com-mitted to increasing educationspending. The goal is to guar-antee an adequate educationthat will give all citizens thechance to participate in the de-velopment of the country and toimprove the system in terms ofquality, teacher competence andsocial help for students.

The program of social help isparticularly important for theyoungest students, and it’s herewhere the government has madea special effort. The children inthe programs receive milk andbiscuits every day. They also re-ceive two school uniforms anda pair of sandals per year, as wellas a backpack containing note-books, pens, pencils and a pen-cil sharpener.

A new program provides everychild in school with an oral hy-giene kit that includes a tooth-brush, toothpaste and a pam-phlet explaining to children whatthey need to do to take care oftheir teeth.

Even without all those efforts,the situation for primary educa-tion has improved tremendouslysince the end of the war. The num-ber of students in Cabinda, in-cluding at the secondary and adultlevel, has risen to more than150,000, from 70,000 in 2002.

In that same year, the regionneeded 400 more classroomsthan it had, a figure that hasbeen reduced to about 50 nowand will continue to decline as

new schools are built and ex-isting facilities are expanded.

Thanks to the years’ long pe-riod of peace, the expansion offacilities and the increasednumber of teachers at work,the government has been ableto slowly raise the number ofyears primary students attendclasses. Primary education hasbeen expanded two more years,from fourth grade to sixthgrade, and the plan is to fur-ther extend the program as itbecomes workable.

Teachers have benefited fromthe reforms to the education sys-tem, too. Their salary has tripledsince 2002, and the total num-ber of instructors has also in-creased to 4,200, from 3,600six years ago. Ongoing are pro-grams aiming to give more up-to-date training to teachers andadministrators so they can bet-ter meet the new realities oftheir students.

The regional government is al-so working on expanding edu-cational possibilities for theprovince’s residents. Work hasalready begun on an ambitiousplan to build a 90-hectare uni-versity campus south of theprovincial capital. The complexwill encompass ten colleges,recreational areas and studentresidences, and will even boasta maritime wildlife reserve. Thecampus’ main building willhouse administrative offices,the central library and the mainlecture hall.

The university project is for thelong-term, but the governmenthas more immediate plans thatare already helping studentsstarting from primary schoolthrough to the level of technicalpreparation for employment pur-poses. One technical school thatopened recently is training work-ers for the country’s hugely im-portant oil industry.

Corridors oflearning open wideTeachers and administrators get up-to-date training to better serve newstudents

Children especiallybenefit from thesemobile health clinics,receiving vaccinationsand vital check-ups

EDUCATION

Cabindans of all ages are receiving vital training that will help integrate them into the province’s labor market

New medical clinics are kept busy, improving the living standards of rural Cabindans

Computers are becoming more common in Angolan educational centers

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Cabinda

Angola recently finished hosting the finalmatch of the CAN2010 African Cup ofNations soccer tournament. The final gamewas played at the national stadium in thecapital, Luanda.

Fifteen teams disputed the championship,including the Angolan national side and oth-er top teams from the continent. The fourcities that hosted matches were Luanda,Cabinda City, Benguela and Lubango.

The opening ceremony and the first gamewere also held in Luanda, with the BlackAntelopes of Angola drawing against Mali4-4. The other teams in Group A were Malawiand Algeria. Group B, consisting of nation-al teams from Ghana, Burkina Faso andCôte d’Ivoire, played at Cabinda’s new,20,000-seat Chiazi National Stadium.

Group C matches were played in Benguelabetween Egypt, Benin, Mozambique andNigeria, and Group D matches were held inLubango by Gabon, Zambia, Cameroon andTunisia.

The championship has been played in itspresent format since 1968, when the orga-

nizers decided to hold the event every sec-ond year. Since then it has been hosted bycountries such as Ethiopia, Egypt and Mali.In 2000, Nigeria and Ghana joined togeth-er to co-host the tournament.

The Egyptian team has dominated thelast three tournaments: in 2006 beatingCôte d’Ivoire in Egypt, in 2008 defeatingCameroon in Ghana, and this year, outscor-ing Ghana by one point.

A major construction plan prepared Cabin-da for the event. The stadium, for example,has special seating sections for 204 VIPs,100 journalists, 65 places for the handi-capped and 100 parking places. Cabinda’shotel offerings were also improved.

Before Angola won the right to host theevent, the province offered about 280 hotelrooms, a figure that rose to about 450 rooms

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