Mthombo, Sonaref, Still Far From the Starting Blocks - Africa’s premier report on the oil, gas and energy landscape.

Mthombo, Sonaref, Still Far From the Starting Blocks

South African and Angolan led refinery projects have been on the drawing board for 10 years.

By Toyin Akinosho, Publisher

Project Mthombo and the Sonaref Refinery‚ two government-led refinery projects meant to collectively process 500,000Barrels of Crude Oil Per Day in Subsaharan Africa, are stalled. Project Mthombo is the South African PetroSA planned 300 000-barrel-aday refinery at Coega in the country’s eastern cape.  Sonaref is the Angolan Sonangol initiated 200,000BOPD project sited at the historic port town of Lobito, on the Angolan edge of the south Atlantic.

18 months after PetroSA signed a two-year framework deal with Chinese behemoth Sinopec, to advance the project ‚ no decision has been made to start construction.

Both Mthombo and Sonaref have been on the drawing board for close to 10 years now. They were both announced, with flourish, at the World Petroleum Congress in Johannesburg, South Africa, in September 2005. The South Africans told the elite delegates to the global petroleum assembly that, owing to an expected shortage in petroleum products around 2020, they were working on a transformational refinery planned to process about 400,000BOPD of crude.

On their part, the more self- assured Angolans said they had a list of investors who would partner them in funding the refinery that would cure the high import of petroleum products in a country with high crude oil production.

But in 2007, Sonangol’s initial partner, Sinopec, walked out of the project. In 2009, Sonangol went ahead and contracted the Field studies to American engineering firm KBR. Sonangol hired Standard Chartered Bank as financial consultant for the project in December 2013.

Meanwhile, in April 2013‚ the same Sinopec, which had walked out of Angola, signed a framework agreement with PetroSA to advance the business plan. PetroSA said it was developing the Mthombo project with Sinopec as anchor partner and the Industrial Development Corporation as funding partner.

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