South Africa to decide on new oil refinery this year
CAPE TOWN (Reuters) — South Africa, a net importer of refined oil products, needs a new refinery and the cabinet is expected to make a firm decision later this year on whether to build one, the new energy minister said on Friday. Mmamoloko Kubayi told parliament that a public-private partnership to develop the new refinery which would be majority owned by the government was the preferred approach.
The idea of building a refinery has been under consideration for almost a decade.
"By the time any new refinery is completed, the country will be importing in excess of a third of its fuel requirements," Kubayi said during her budget vote speech.
National oil company PetroSA has promoted the idea of building a new refinery with a capacity of up to 400,000 bpd on the east coast.
However, a price of $10 B projected in 2010 and a lack of equity partners has delayed the project.
Kubayi said the government also wants to increase the participation of black fuel wholesalers in importing crude oil, with an immediate focus on West African crude oil, which presently accounts for around half of South Africa's crude imports.
"The modalities of this strategic approach will be finalized after consultation with the major oil companies in this financial year," she said.
Royal Dutch Shell, BP, Total and Sasol are among the main refinery operators in Africa's most industrialized country.
Reporting by Wendell Roelf; editing by James Macharia and Jason Neely
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