Angola and the Resource Curse Harvard Case Solution & Analysis

Angola

The history of oil sector in Africa stretches back to many decades. According to the latest statistics and research, the oil reserves of African countries have grown steadily. In fact, they have increased by a sheer 150%. The amounts have increased by 53.4 billion barrels at the stage of 130.3 billion barrels since 2012.   The research paper discusses the three countries that are Angola, Ghana and Brazil where Oil and Petroleum Company can develop a business related to products in the same industry (Omeje, 2006).

Oil in Angola was first discovered in 1955. It was found in the onshore Kwanza basin near Luanda. However, it is a fact that the oil industry did not take off until 1960s where the country found massive reserves off the coast of oil in the northern area of Cabinda. This was the time when the government actually tried to bring in foreign investors to come up and develop business in oil and petroleum sector of the country. The business that will be most suited for a company entering Angola to start a business in oil and petroleum sector of Angola is to look and explore the market for setting an oil refinery in the country (J. Graf, 2006).

The reason is quite simple; Angola has been one of the major producers of oil since 2013, where the country has produced 1.7 million barrels of crude oil. The production of oil has actually grown by an average 15% from the year 2002 to 2008. This has happened solely because of the fact that large international oil companies (IOCs) have built up there oil fields in the country. This is the main reason why Angola should be considered by a new company to enter the oil and petroleum industry by forming an oil refinery in the country. The potential of growth and the development in this sector of petroleum industry will provide Angola with an increase in its GDP and its credibility in the international market. The poverty level which is quite high as compared to some other countries will also reduce and hence the common man will be provided with opportunities such as labor opportunities, revenue generation, partnership with local suppliers, etc (Gates, 1999).s

Brazil

The discovery of oil in Africa has been recorded back a long time ago. Recent studies has led to the discoveries of more oil reserves. Africa used to produce 53.4 billion barrels but since 2012 the number has increased up to 130.3 billion barrels anually. (Baer, 2001).

Brazil has been one of the soundest economies in the region. The statistical research shows that Brazil has been producing 2.1 barrels of oil per day. With these numbers, still Brazil requires significant improvement in its refinery or the oil sector. The main reason for this problem is the fact that Brazilian refineries producing oil have been unable to perform as it should have actually performed (Campos, 1993). The reason is simply that the country has mainly focused on staying as a gasoline manufacture and exporter off late. The most obvious choice for any company looking to invest in Brazil oil and petroleum sector is to opt for the option of investing in production and development (Cowley, 2010).

The reason it is the most feasible industry because of the fact that the latest exploration opportunities that have been created by the government have been licensed in 2008. With this aspect, political wrangling has continued which is regarded as the allocation of the oil reserves. With the fact that, this Brazilian licensing has actually helped and supported the slowdown of exploration activity in Brazilian oil and petroleum industry. In the face of the lack luster oil and the petroleum industry can help the Brazilian companies entering the country. The reason of exploration is a good option because the ultimate result it will provide the Brazilian economy, as a  fact that the rules and regulations that are not forced by the government will help new companies entering the country. Therefore this is the reason to actually opt for the exploration and development of oil and petroleum sector in Brazil.

Ghana

Ghana established its Petroleum Commission Act 821 in the year 2011, the basic purpose of the commission was the regulatory authority and control over the oil and petroleum industry in Ghana. The country has been producing crude oil and petroleum products in commercial quantities in the year 2011..................

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Since emerging from decades of conflict in 2002, Angola is growing at scorching double digits, led by its oil industry. But the nation is faced with insurmountable problems: a huge inequality, low life expectancy, non-diversified economy, and the constant nagging of corruption. The global financial crisis and the subsequent fall in the income of the state oil drives credit looking for Angola or the IMF, which require large-scale reforms, or the Chinese, who tend to take a direct interest in the country's reconstruction. The case is considered the dynamics of post-conflict reconstruction, as well as problems associated with reliance on oil wealth, including the resource curse and the Dutch disease. "Hide
by Aldo Musacchio, Eric Werker, Jonathan Schlefer Source: Harvard Business School 24 pages. Publication Date: September 7, 2010. Prod. #: 711016-PDF-ENG

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