Angolan oil giant Sonangol reports $4.1bn in net loss in 2020

Angolan state oil giant Sonangol registered a $4.1 billion net loss in 2020 as the Covid-19 pandemic hollowed out sales and the company struggles to lighten its large debt with asset sales, according to its annual results published this week.

The company is the engine of Angola's economy and central to a state drive to lift its people out of poverty and alleviate the country's vast debts to China and other lenders.

Sonangol's total liabilities stood at $26.8 billion at the end of 2020, using the official average exchange rate for the year, while debt repayments alone cost it $2bn, the 238-page annual results showed.

The company took out two new bank loans totalling $1.5bn in 2020, while another for $850 million was agreed this year with an option to borrow a further $450 million.

Sonangol said debts to western oil companies operating its oilfields were not reflected in its results. Such liabilities could amount to about $1bn, sources have previously told Reuters, although the company has not commented on that figure.

The company said the disappointing performance in 2020 was "a result of the drastic reduction in revenues from sales of crude oil" due to the pandemic, despite Angolan annual oil output being slightly higher than in 2019.

It cited a global glut in oil as travel restrictions hammered demand, as well as weaker buying by its main customer China.

Even before the pandemic, in 2019, Sonangol registered no profit from its core oil business and only a modest overall profit of $125m.

The company announced a sale of stakes in eight flagship offshore oil blocks in June to help alleviate debt, but no announcement of any buyers has been forthcoming.

Sonangol has made little progress toward plans to privatise non-core aspects of its businesses culminating in a listing of a 30 per cent stake in the company itself. It sold its loss-making trading arm Puma Energy to Trafigura for $600m this year.

Navdeep Suri, India's Ambassador to the UAE

There has been a longstanding need from the Indian community to have a religious premises where they can practise their beliefs. Currently there is a very, very small temple in Bur Dubai and the community has outgrown this. So this will be a major temple and open to all denominations and a place should reflect India’s diversity.

It fits so well into the UAE’s own commitment to tolerance and pluralism and coming in the year of tolerance gives it that extra dimension.

What we will see on April 20 is the foundation ceremony and we expect a pretty broad cross section of the Indian community to be present, both from the UAE and abroad. The Hindu group that is building the temple will have their holiest leader attending – and we expect very senior representation from the leadership of the UAE.

When the designs were taken to the leadership, there were two clear options. There was a New Jersey model with a rectangular structure with the temple recessed inside so it was not too visible from the outside and another was the Neasden temple in London with the spires in its classical shape. And they said: look we said we wanted a temple so it should look like a temple. So this should be a classical style temple in all its glory.

It is beautifully located - 30 minutes outside of Abu Dhabi and barely 45 minutes to Dubai so it serves the needs of both communities.

This is going to be the big temple where I expect people to come from across the country at major festivals and occasions.

It is hugely important – it will take a couple of years to complete given the scale. It is going to be remarkable and will contribute something not just to the landscape in terms of visual architecture but also to the ethos. Here will be a real representation of UAE’s pluralism.

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part one: how cars came to the UAE