Angola, Africa’s seventh-largest country, is primarily recognized for its significant oil exports, contributing around half of its fiscal revenues. However, recent international attention has shifted towards the country’s largely unexplored mineral wealth, rather than its oil reserves.
While Angola boasts a robust diamond mining sector, making up approximately 8% of global production, nearly 60% of its land remains unexplored for minerals and metals.
Bryony Richards, an economic geologist from the University of Utah, notes, “Angola is rich in mineral deposits, yet there are few active mines. Much of the country lacks detailed geological data beyond basic maps.”
These uncharted territories are believed to hold substantial reserves of critical and rare earth minerals like copper, cobalt, manganese, and lithium. Diversifying into these resources could help Angola reduce its dependence on oil and diamonds.
Diamonds Remain Valuable
Angola’s diamond industry continues to thrive, with production reaching 9.7 million carats last year and an expected 50% increase in 2024. This growth is largely attributed to the Luele project by Catoca, Angola’s state-controlled diamond miner. The project is one of the world’s largest diamond mines, estimated to yield around 628 million carats over 60 years. De Beers, the world’s leading diamond producer, has also strengthened its presence in Angola through various agreements with the government.
Tapping into Rare Earths
Recent investments in Angola include the Longonjo rare earths project by Pensana and exploration rights acquired by Canadian miner Ivanhoe in the provinces of Moxico and Cuando Cubango.
The Longonjo project is strategically located near the Lobito rail Corridor, offering a faster route to market. Ivanhoe plans to invest at least $10 million in initial exploration across a vast area of 22,195 km².
Richards believes Angola’s potential in rare earth elements is promising, especially as the government begins to recognize these opportunities alongside diamonds in its National Development Plan.
Attracting Foreign Partnerships
Angola has strengthened its ties with Western countries. In November 2023, the US Geological Survey and Angola signed a cooperation protocol to map Angola’s mineral resources, potentially attracting more investments. Secretary of State Antony Blinken’s visit in January marked another significant step in this partnership.
The EU and Angola also signed an investment facilitation agreement, aiming to attract European finance to untapped sectors like critical minerals. Angola’s admission to the Extractive Industries Transparency Initiative in 2022 signals its commitment to transparency and accountability.
Under President Joao Lourenco, Angola is pushing for economic reforms, including the partial listing of major companies like Sonangol and Endiama, which promotes transparency and attracts foreign investors.
Challenges Ahead
Despite the opportunities, Angola faces numerous challenges. Richards points out obstacles like education, investments, and health risks. The legacy of landmines from the civil war poses safety concerns. Corruption remains a challenge, though there has been improvement in recent years.
Water scarcity and technological and infrastructure limitations also hinder development. Saleem H Ali from the University of Delaware emphasizes that investments must benefit the local population to avoid unrest.
Richards emphasizes the need for trust-building, stating that companies must earn the trust of the local communities. Despite the risks, she believes that Angola stands to benefit from international investment and attention, especially with efforts to reduce risks through government or industry incentives already underway.
