Chevron's Angola oil output to rise 25 percent by 2011

LONDON (Reuters) - Chevron's crude oil production in Angola will rise by a quarter in the next two years and it expects new discoveries to boost the country's oil production further, Ali Moshiri, Chevron's president for Africa and Latin America said.

Chevron (CVX.N) is one of Angola's largest oil producers, responsible for operating oilfields with an output of over 500,000 barrels per day (bpd) of oil in 2008, of which 145,000 bpd was its own equity oil.

Two new oilfields, Mafumeira Norte and Tombua-Landana, came onstream in 2009 with peak production for both fields expected to be reached in 2011, totaling an extra 130,000 bpd.

"We see great potential in Angola and our investment is sustainable. It is one of the most active areas in Africa for us at the moment," Moshiri told Reuters.

Chevron's $3.8 billion Tombua Landana Project reached first oil in August 2009 with recoverable resources estimated at approximately 350 million barrels. Peak production of 100,000 bpd of crude oil is expected to be reached in 2011. Moshiri believes Angola has big potential and expected oil production to increase further, driven by continued interest from large foreign oil companies.

"Right now all the major oil companies are players in Angola and with all this investment our expectation is that there will be other discoveries and that there is potential for higher oil production in Angola."

Angolan crude oil production has approached 2 million bpd this year and briefly overtook Nigeria as Africa's largest oil producer, encouraging interest from oil companies around the world.

The main operators currently working in Angola are Western majors, including France's Total (TOTF.PA), Chevron and Exxon Mobil (XOM.N), but expectations are that Chinese companies will increase their investment across West Africa.

CHINESE INTEREST

Moshiri said Chinese interest in increasingly stable country's like Angola was inevitable given its need to fuel its growing economy.

"I think China has interest anywhere and everywhere that has a hydrocarbon resource and for a good reason. Their economy depends on crude oil at the moment and I think we're going to continue to consider China as a partner who is looking for resources."

A further incentive for potential oil investors in Angola, where many opportunities are in expensive offshore developments, is the recovery of crude oil prices this year.

U.S. crude oil has rallied over 150 percent from its low of $32.40 a barrel in December last year, hitting a 2009 high of $82 a barrel on Thursday, which should encourage further investment in more expensive deep offshore opportunities in Angola.

But Moshiri said short-term oil price movements, up or down, would not have an impact on the decisions it makes on future projects in Angola because it has long and deep ties with the country.

Long term, Chevron is keeping a close eye on the macro-economic influences on the oil price to ensure future security for its business.

"The oil price is affected by the global economy, in places like China and India. We are watching for that to make sure it has a strong foundation and it can support our projects for many years to come."

Although crude oil has been the concentration for foreign operators in Angola, Chevron said its focus, in partnership with the Angolan government, was switching to natural gas.

"Angola is now diversifying from oil into gas. Gas could actually have more potential in Angola than crude oil and LNG exploration could also lead to more light oil finds," Moshiri said.

Chevron's main gas project Angola Liquefied Natural Gas (LNG) is a multi-billion dollar operation expected to supply 5.4 million tonnes per annum of LNG for export.

As of September 2009, the project was around 46 percent complete and remains on schedule for start-up in 2012.

(Editing by Sue Thomas)