Sonangol Group

Foundation

On the eve of Portuguese Angola's independence from Portugal following the Carnation Revolution and the election of a democratic government in Portugal in 1976, the company ANGOL (ANGOL Sociedade de Lubrificantes e Combustíveis SARL), founded in 1953 as a subsidiary of Portuguese company SACOR) was nationalized and split in two, forming Sonangol U.E.E. and Direcção Nacional de Petróleos. Directive 52/76 instituted Sonangol as a state-owned company with a mandate to manage the country's substantial petroleum industry. Using the extant remains of Texaco, Total, Shell and Mobil's oil works, Sonangol obtained the assistance of Algerian Sonatrach and of Italian Eni.[2]

Expansion

As the company grew it had a need to obtain services, such as telecommunications services, retail network support, trucking, shipping, data management, scientific, engineering, seismic, and others. The company created subsidiaries to meet these needs. Sonangol and its many subsidiaries have continued to expand into other lines of business.[3]

In 1983, Sonangol opened its first international subsidiary, Sonangol Limited, in London.

In 1992, Sonangol P & P was founded as a prospection and production subsidiary.

In 1999, Sonangol U.E.E. became Sonangol E.P.

Oil giant Marathon Oil announced in September 2013 that it had agreed a deal in principle to sell a 10% stake in its offshore Angolan oilfield to Sonangol.[4]

Graft under the dos Santos family

Didier Keller bribery case

According to the judgement of a Swiss court in 2020, Didier Kelley paid key Sonangol officials a total of US$ 6.8 million in bribes between 2005 and 2008 while CEO of SBM Offshore. Kelley was fined over US$ half a million.[6] At the time the bribery took place, the chairman of the board of directors of Sonangol was Manuel Vicente, who was also Vice President of Angola under President José Eduardo dos Santos. Though Vicente was not accused of accepting these bribes directly, in the opinion of the Swiss authorities, he would have been aware of them.[7]

Dream's Leisure

Starting in 2006, Sonangol financed the construction of the Centro de Convenções de Talatona (CCTA), a convention center which was opened in December 2009 by President dos Santos. The CCTA included the five-star Hotel de Convenções de Talatona (HCTA), and in total cost Sonangol over US$ 200 million. Despite being the sole financier, Sonangol only held a 30% stake in the CCTA, which was majority held by Simaroco and also partially by Oil International Supply Services S.A. (OISS) and a Chinese investor. Simaroco was founded in 2005 by José Carlos de Castro Paiva, then chairman of Sonangol Limited and Sonangol's representative on the board of directors of the Banco Africano de Investimentos. OISS was owned in part by Alberto Cardoso Severino Pereira, Sonangol's former financial director, and lawyer Domingos de Assunção de Sousa de Lima Viegas, who was also employed by Sonangol and was Sonangol’s representative on the auditing committee of the BAI. In effect, this transferred millions of dollars' worth of assets held by a state entity into private hands.[8][9]

A ten-year, a US$ 12 million contract for management of the HCTA was then awarded to Dream's Leisure, a company created thirteen days prior to the issuing of the contract, which was owned by

Exem Energy and Sindika Dokolo

In 2006, a company named Exem Energy BV acquired, in exchange for a US $11 million loan from Sonangol, a 6% stake in multibillion dollar Portuguese international energy company Galp Energia worth US$ 750 million through shares in holding companies Amorim Energia, which holds a 33.45% share in Galp, and Esperaza, which holds a 45% stake in Amorim. Exem Energy BV was controlled and 40% owned by Sindika Dokolo, who was the husband of President dos Santos's daughter Isabel dos Santos.[10]

This move was later described in 2020 as "tainted by illegality" by a Dutch international arbitration tribunal in Amsterdam, "to reap an extraordinary financial gain to the detriment of Sonangol and, consequently, of the State of Angola,"[11] which froze Exem's assets, ruling in favor of a legal complaint by Sonangol that Exem owes them the shares back because of the corrupt way in which they were acquired.[12]

Unaccounted-for billions

In December 2011, Human Rights Watch said that the government of Angola should explain the whereabouts of US$32 billion missing from government funds linked to Sonangol. A December 2011 report by the International Monetary Fund (IMF) said that the government funds were spent or transferred from 2007 through 2010 without being properly documented in the budget.[16] The IMF was assured that most of $32 billion was being used for "legitimate government reasons" and considered to be "found".[17]

Isabel dos Santos

In June 2016, President dos Santos removed the entire board of Sonangol, and installed his daughter Isabel as chairwoman of the company, to "ensure transparency and apply global corporate-governance standards".[18] This led to many accusations of corruption and nepotism. One year later, Maka Angola reported that Isabel dos Santos demanded, with threat, that the Ministry of Finance inject three billion US$ into the company, claiming it was necessary to rescue Sonangol from immediate bankruptcy, though this was not granted.[19]

Isabel and her inner circle were paid salaries, described in one indictment as "exorbidant renumerations," that cost Sonangol over US$ 13 million in 14 months between 2016 and 2017, with her own monthly salary set at more than US$ 50,000.[20]

In November 15, 2017, the new President of Angola, João Manuel Gonçalves Lourenço, dismissed both Isabel and the entire board of directors under her and named Carlos Saturnino Guerra Sousa e Oliveira as the Sonangol chairman.[21]

Privatization and streamlining

In February 2019, the Angolan government began its Propriv privatization program, and created the National Oil, Gas and Biofuel Agency (ANPG) to take over regulation and promotion of the Angolan petroleum industry from Sonangol. ANPG was given the power to supervise Sonangol, and became the new national concessionaire. In this regard, ANPG now controls who wins licenses to explore for petroleum, and awards contracts for production.[27]

In May 2019, Carlos e Oliveira was sacked[28] and replaced by Sebastião Gaspar Martins as head of the company.[29]

In July 2019, President Lourenço canceled the Dream's Leisure contract, returning control of the Talatona hotel to the state.[9]

In April 2020, the Ministry of Finance began conducting a pruning of Sonangol's other functions, including a selling of its peripheral businesses such as its ventures in aviation

Main headquarters

Sonangol's main corporate headquarters are in the Sonangol Building located on Rua Rainha Ginga, No 29-31 in the commercial Baixo neighborhood of the Ingombota district in Luanda. The Sonangol Building was built in 2005, designed by Chinese architect Sung-ho Hang. 2,000 people are employed in the building.[35]

Energy and petroleum