China loans $2bn to Angolan state oil firm

China loans $2bn to Angolan state oil firm

Tuesday, December 16, 2014 8:51 am


Official headquarters of Sonangol in Luanda

Official headquarters of Sonangol in Luanda

Angola’s state oil company Sonangol will benefit from a new $2.0 billion line of credit from the Chinese Development Bank to finance new projects, the state oil company said.

“This Chinese financing will support Sonangol’s plans for expansion in oil and gas,” the company said in a statement, adding that among the first projects will be a new refinery in Lobito, southern Angola, next year.

The southwest African country is China’s second biggest supplier of oil, accounting for some 40 percent of the Asian giant’s needs.

Since the end of Angola’s civil war in 2002, Beijing has extended a total of $14.5 billion (11.65 billion euros at current exchange rates) to the former Portuguese colony, according to the latest figures from the Chinese embassy in Luanda.

Recent years have seen China help finance major infrastructure projects including roads, rail lines and new cities.

During a state visit to Angola by Chinese Prime Minister Li Keqiang in May, he and President Jose Eduardo dos Santos pledged to diversify their cooperation, currently concentrated in the construction sector.

Bilateral trade totalled nearly $36 billion last year, according to the Chinese customs services.

The new line of credit comes at a difficult economic time for Angola, Africa’s second largest oil producer after Nigeria, because of plunging world prices for crude.

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