REFINERY NEWS ROUNDUP: Potential closures in Africa on new sulfur rules

A number of refineries in Africa face closure if they fail to upgrade and produce 10 ppm diesel by 2030, according to panelists at ARDA conference.

Some of the refineries on the continent, including Ghana's Tema, still need to upgrade to produce 50 ppm max gasoil. Meanwhile two of the refineries in South Africa -- Engen and Sapref, have upgraded to produce max 50 ppm gasoil but will need additional investment to produce 10 ppm diesel and have opted to close instead.

South Africa's Engen said it will be proceeding with the conversion of its Durban refinery into a terminal. The refinery has been shut since a fire and explosion December 2020.

Meanwhile earlier this year South Africa's largest refinery Sapref said it will halt operations no later than the end of March.

Zambia's Indeni has also been mothballed.

However, other refineries are undergoing upgrades, some of which like Senegal's SAR and Angola's Luanda are due to complete in the coming months.

ONGOING MAINTENANCE

UPGRADES

LAUNCHES

Near-term maintenance

New and revised entries

** Cameroon's Limbe refinery, which suffered from a fire at the end of May 2019, remains offline, with the government considering whether to repair the damaged plant or build a new site, according to a source close to the refinery. The fire mostly damaged a fractionation unit used for gasoline production, but the CDU is fairly intact, the source said. The refinery increased its capacity to 72,000 b/d from 45,000 b/d shortly before the explosion happened through an upgrade program, which involved the construction of a vacuum distillation unit, a catalytic reformer and a power plant.

** Senegal's sole refinery in Dakar, currently undergoing maintenance and upgrade, is due to restart in April, according to panelists at the ARDA conference. It is building a new preflash unit and expanding the catalytic reformer. The refinery started a four-month maintenance in November, due to continue until March, during which the refinery would align new units with existing equipment, S&P Global Commodity Insights has reported. The upgrade is part of the refinery's capacity expansion as well as adaptation of units to process Senegalese crude oil. The Dakar refinery has plans to increase its capacity to 1.5 million mt/year.

Existing entries

** Zambia's Indeni refinery continues to be offline as the government is looking to overhaul operations at the plant after it was closed down due to financial and technical reasons, a refinery spokesperson told S&P global Platts on Feb. 22.

"The refinery is now on care and maintenance, as the shareholder looks at remodeling the business," the spokesperson said. "Operations have effectively been mothballed, with all products being imported." The refinery's operations have been suspended since late-December due to financial and technical reasons. The government wanted to overhaul the aging refinery, but the project had been put on hold until the elections. The new government headed by President Hakainde Hichilema, who was elected in late-August, is still to take a final decision on the refinery.

** South Africa's largest refinery Sapref will halt its operations no later than the end of March, BP and Shell, its two shareholders, said in a statement. The refinery operations will be suspended for "an indefinite period" with a possible restart, "including in the event of any future sale." "The decision has been taken to allow an informed finalization on the various options available to the shareholders, a sale option being the most preferred," the two companies said.

** Congo's Pointe Noire refinery will carry a full two-month turnaround in June, according to consulting company CITAC Africa. The refinery had been expected to carry out works in 2021.

** South Africa's Astron Energy Cape Town refinery is expecting to restart in the second half of 2022, the company said Jan. 25. It is currently "in the process of rebuilding the affected section" of the refinery "with a view of the safe restart," it said. The refinery has been halted since an incident in July 2020 involving an explosion and fire.

** Ghana's sole oil refinery, Tema, remains offline and the plant is unlikely to restart for a few more months due to a lack of crude and feedstock. The plant has been hit by several issues over the past few years, experiencing intermittent outages at its crude distillation unit and FCC unit. The CDU currently only has one furnace, which means the refinery can only operate around 30,000 b/d capacity.

** South Africa's Engen said it will be proceeding with the conversion of its Durban refinery into a terminal. The refinery has been shut since a fire and explosion Dec. 2020. The refinery-terminal conversion was expected to be commissioned in Q3 2023.

** Libya's Ras Lanuf remains offline without any timeline for its restart. The refinery was shut in 2013.

Upgrades

New and revised entries

** Sogara, Gabon's sole refinery, is working on building a new hydrocracker, according to a source close to the refinery. The unit, which will allow the refinery to produce ultra-low sulfur diesel, is expected to come online in 2025.

** Cote d'Ivoire's SIR refinery is in the process of upgrades, a company source said at the ARDA conference. The refinery expects to complete a FEED study into a new diesel desulfurization unit by the end of 2022 and commission the unit, which will enable it to produce 10 ppm diesel, by the end of 2025 or early 2026. It is also working on a project aimed at reducing the benzene content of gasoline by 1% in volumes. Separately, it is working on CDU capacity expansion by 20% and a new reformer construction which will enable it to improve gasoline production. Both projects are expected to be completed in 2027. The refinery is also expecting to launch a modular power plant which will help it to produce electricity from natural gas and to improve energy efficiency. The refinery will use Honeywell UOP Distillate Unionfining technology to produce diesel that complies with both AFRI 6 and Euro-V emission standards.

** The upgrade of Angola's Luanda refinery is nearing completion, a company source said at the ARDA conference. It will increase gasoline production from 72,000 mt/year to 450,000 mt/year with the project due to be completed in June and production expected to start in August 2022. The refinery will process the naphtha it currently exports. Italy's Kinetics Technology has been awarded a contract to build a naphtha hydrotreater and platformer. Sonangol is also in the process of building a fluid catalytic cracker along with Italy's Eni.

** Senegal's sole refinery in Dakar, which is currently undergoing maintenance and upgrade, is due to restart in April, according to panelists at the ARDA conference. It is building a new preflash unit and expanding the catalytic reformer. The refinery started a four-month maintenance in November, due to continue until March, during which the refinery would align new units with existing equipment, S&P Global has reported. The upgrade is part of the refinery's capacity expansion as well as adaptation of units to process Senegalese crude oil. The Dakar refinery has plans to increase its capacity to 1.5 million mt/year.

Existing entries

** Construction of the hydrocracker complex at Egypt's Assiut is expected to be completed in Q4, 2023, according to a statement on the website of Egypt's petroleum and mineral resources ministry. A $1.5 billion financing agreement has been signed with six banks and international lending institutions to finance the Assiut Hydrocracking complex which will convert fuel oil into high value products.

TechnipFMC said in late 2020 that it had "successfully completed the remaining conditions to enable work to commence" on its contract for the engineering, procurement and construction of the new hydrocracker. The contract includes process units such as vacuum distillation, diesel hydrocracker, delayed coker, distillate hydrotreater and a hydrogen production facility. The project also includes other process units as well as interconnecting. It will transform lower value products into about 2.8 million mt/year of cleaner products, such as Euro 5 diesel.

The upgrade at Assiut includes the installation of 880,000 mt/year continuous catalytic reforming and isomerization complex, a 400,000 mt/year vapor recovery unit and a 2.3 million mt/year hydrocracker.

** NNPC said early January 2022 that it remained on track to complete rehabilitation of the Port Harcourt refinery located in the southern Rivers state on schedule, despite a recent fire outbreak at the facility. The Port Harcourt refinery has been shut down since late 2020 for a major overhaul aimed at restoring the facility to optimum performance. The repair work on the refinery, which is being handled by Italian engineering company Tecnimont, began in April 2021 and NNPC had said previously that the first phase of the exercise would be completed in 18 months.

Nigeria's refineries, which include the northern Kaduna and the Warri refineries, have been shut for repairs since early 2019, and NNPC expects them to operate at around 90% of capacity when repairs are completed and they resume production by 2023.

But this timeline is expected to be pushed back as 2020 saw numerous delays, exacerbated by the coronavirus pandemic. Repairs at the Warri and Kaduna plants would commence immediately after Port Harcourt.

** State-run Indeni Oil Refinery, Zambia's only refinery, has plans to double its capacity to 2.2 million mt/yr once rehabilitation works are completed. This will be up from the current capacity of 1.1 million mt/year.

** Kenya is considering converting its shuttered Mombasa refinery to a biofuel plant using technology provided by Italy's Eni. The Mombasa refinery, Eastern Africa's sole refinery, was shut down in 2013. Kenya is deciding upon a location for a new refinery in either Lamu or Mombasa.

** The European Bank for Reconstruction and Development has reviewed a provision of up to $250 million sovereign loan to the Alexandria Petroleum Company to finance resources and energy efficiency investments and other modernization investments. The project includes the installation of a new vapor recovery unit, continuous emissions monitoring system and a burner management system. An expansion program at Egypt's Middle East Oil Refinery near Alexandria is on track for 2022, which will push capacity to 160,000 b/d.

** The European Bank for Reconstruction and Development, or EBRD, approved a $50 million loan for an upgrade of Egypt's Suez refinery aimed at introducing cleaner fuel and reducing CO2 emissions.

Launches

New and revised entries

** The second phase of the new Cabinda refinery is due for completion in 2023 and will be followed by the third phase. Some 44% of the engineering is currently complete and equipment for the first phase will arrive from Houston in June 2022, a company source said at the ARDA conference. Under its first phase, which will be completed in July, Cabinda will process 30,000 b/d. The second and third phase will see capacity expanded to 60,000 b/d and the addition of a catalytic reformer, catalytic cracker and hydrotreater. Construction of the refinery, built by Gemcorp, involves a first phase, which includes construction of a CDU, desalter unit, kerosene treatment unit and ancillary infrastructures including a conventional buoy mooring system, pipelines and storage facility for over 1.2 million barrels.

** Preparations for the construction of the Soyo refinery in Angola are underway. Construction will start in April and is expected to be completed in 2025.

** Sonangol expects to complete the Lobito refinery project in September 2026-February 2027, a company source said at the ARDA conference. The project was halted in 2016 but has since resumed. The FEED study for a single train refinery with a hydrocracker will be completed in December 2022.

** The expected start-up of Uganda's planned 60,000 b/d oil refinery has been delayed to 2027 due to disruptions caused by COVID-19, Ruth Nankabirwa, Uganda's energy minister, said March 21. It was expected to come online in 2024-25. Nankabirwa said the Albertine Graben Refinery Consortium (AGRC) had made significant progress in pre-final investment decisions and planned to expedite all pending activity so the refinery's final investment decision is undertaken by the end of next year. The refinery will be built at Kabaale in Hoima District, near the Lake Albert oil fields, and will also have a 211 km long multi-products pipeline that will ship refined products such as gasoline, LPG and kerosene to a storage terminal near the capital Kampala.

Existing entries

** The Dangote refinery in Nigeria is mechanically complete and undergoing test runs, and should be ready for operations sometime in the second half of the year, according to company officials. "Mechanical work on the refinery is complete and hopefully before the end of third quarter we should be in the market," the president of Dangote Group, Aliko Dangote, said at an event at the refinery on Jan. 22. ''The plant will start with a processing capacity of 540,000 b/d. Full production can start maybe by the end of the year or beginning of 2023.'' A company official told S&P Global Platts that the official start-up will be dependent on the test runs. Test runs are expected to end by the third quarter, after which production of refined products will start.

"Barring any hitches during this period of the test run of the units, the refinery will start refining crude into oil products by the fourth quarter of this year," the official said Jan. 24.

The start-up date of the refinery, which was first announced in 2013, has been repeatedly delayed. The project suffered some delays last year due to the coronavirus pandemic.

** The Edo refinery, in Ikpoba, Edo State, Nigeria, is currently in the process of expanding its capacity to 36,000 b/d, according to a source close to the refinery. The 6,000 b/d modular refinery was launched in September 2021 and is running at full capacity. Its production includes 50% gasoil, 28% naphtha and the rest is 0.5% fuel oil. The expansion is expected to be completed in 2023. Upon the completion, the refinery will be producing naphtha, ULSD, ULSFO and LPG.

** South Sudan's Bentiu refinery near Juba in Unity state, which started operations in March 2021, is still running at 3,000 b/d but the government is aiming to boost runs to its nameplate capacity of 10,000 b/d, according to South Sudan's Minister of Petroleum Puot Kang Chol. Bentiu had been offline since 2014 after suffering damage in clashes connected to the country's civil war. Repair and upgrading works had been due to finish by the end of 2019 but did not meet this deadline and then travel restrictions due to the COVID-19 pandemic led to evacuation of engineers at the site in early 2020, causing further delays.

** South Sudan is planning to build four more refineries by the end of this decade to increase its refining potential. Trinity Energy was in advanced preparations to start building a 40,000 b/d refinery near the Palouch oil fields in the Upper Nile. Construction was planned to start in the first quarter of 2019, but COVID-19 and electricity power outages delayed it. One of the refineries is set to be based in Tharjiath.

** The Angolan government has launched a tender process for companies interesting in investing in the country's biggest refinery project in Lobito in southern Angola. Sonangol said it had already carried about economic feasibility studies, the dredging of Lobito bay, and other technical work that "will allow potential partners to act more effectively." The project was initially canceled in 2016 only to be revived a few years later. Sonangol is now banking on this refinery coming online in 2025.

** Algeria's Sonatrach expects the Hassi Messaoud refinery to start operations in 2024.

Construction was launched at the beginning of 2020 and the refinery's start-up has been expected for H2 2024. Sonatrach has contracted with Spanish and South Korean consortium Technicas Reunidas-Samsung Engineering to build the new refinery. Hassi Messaoud, Biskra and Tiaret had been part of the government's 2021-24 oil sector plan, with each refinery intended to have a 5 million mt/year capacity.

However, investment decisions on the refinery projects in Biskra and Tiaret would not be made before 2025.

** KBR has been awarded a front-end engineering design, or FEED, for Bua Group's new, modern refinery facility in Nigeria. Bua Group plans to build a 200,000 b/d integrated refinery and petrochemical plant in Akwa Ibom, according to its website. The plant aims to produce Euro 5 fuels and polypropylene for the domestic and regional markets.

** Modular facilities in Nigeria are nearing completion, including the 10,000 b/d plant in Port Harcourt, Rivers State and the 10,000 b/d modular refinery Ibigwe, in Imo State.

** Nigerian National Petroleum Corp., or NNPC, is close to taking a final investment decision (FID) with some investors to build a 50,000 b/d condensate refinery. NNPC signed the front-end engineering design for the construction of the plant -- which will be in the Niger Delta -- with engineering firm KBR. NNPC first announced in August 2018 plans to build a condensate refinery with capacity to refine 200,000 b/d of the condensate oil produced by the country.

** Nigeria commissioned in 2020 the country's first modular oil refinery, built in Imo state by Waltersmith. The commissioning involved the first phase of the refinery with a capacity to refine 5,000 b/d of crude. It would eventually raise capacity to 45,000 b/d.

** Nigeria has reached an agreement with neighbor Niger to build an oil refinery in a border town between Niger and Katsina state in northern Nigeria.

** The Ministry of Hydrocarbons of Guinea has signed a memorandum of understanding with logistics firm United Mining Supply to set up an oil refinery. UMS has said it will carry out a feasibility study to construct a refinery in Moribayah.

** Africa Finance Corp., or AFC, has signed an agreement with Brahms Oil Refineries Ltd. to co-develop a refinery and storage terminal in Guinea. AFC will work on the development and subsequent financing of a petroleum storage and associated refinery project in Kamsar, Guinea. This will include a 12,000 b/d modular refinery, a 76,000 cu m crude oil storage terminal, a 114,200 cu m storage terminal for refined products, and ancillary transportation infrastructure. Guinea currently has no refineries.

** The construction of Republic of Congo's Atlantic Petrochemical Refinery project has begun. The government signed a deal with China's Beijing Fortune Dingsheng Investment Co. Ltd., or BFDI, to construct a 2.5 million mt/year refinery in the port city of Pointe Noire. The Chinese company is also keen on launching a petrochemical complex in the country. The African oil producer currently has only one refinery, the 27,000 b/d CORAF plant, which is also located in Pointe Noire.

** The Cameroon government is looking to build a new refinery in the southern port city of Kribi with a capacity of 4 million mt/year after operations at its sole refinery in Limbe were crippled due to a major fire in 2019. Kribi has been chosen as the site as it is already home to the country's main crude export terminal.

** Equatorial Guinea's 5,000 b/d modular oil refinery project at Punta Europa is expected to receive an FID in Q1 2022. The government is hoping to build two modular refineries in the country, one at the Punta Europa complex on Bioko Island, and the other at Cogo on the mainland.

** Benin is looking to launch the construction of a new refinery. A committee will look at the feasibility studies for the project and will also analyze the market prospects until 2030. The project will be developed as a public-private partnership.

** Russian state development bank VEB has signed investment cooperation deals with African organizations on financing a refinery in Morocco. The memorandum on the oil refinery in Morocco was signed with the Russian Export Group and Morocco's MYA Energy, part of the Marita Group. The refinery has a planned capacity of up to 5 million mt/year. Morocco's sole refiner Samir was forced to halt processing at the Mohammedia plant in 2015 after crude oil deliveries were delayed due to financial problems. Since then attempts to resume operations or find an investor have been unsuccessful.

** A consortium of Russian investors is planning a $4 billion project for a new refinery in Northern Zambia at the site of the country's aging state-owned Indeni plant.

** Russian state-owned exploration company Rosgeologia is considering building the Red Sea Coast refinery in Port Sudan, which would supply landlocked countries in Africa. Sudan had begun discussions to develop a 200,000 b/d refinery on its Red Sea coast. The project's timeline has not yet been disclosed.

The only refinery currently operating in the country is the Khartoum, after the Port Sudan refinery closed in 2013 and was decommissioned.

** Ghana's ministry of energy is in the process of submitting a proposal to build a new refinery in Tema. It will replace the 45,000 b/d Tema Oil Refinery.

Separately, the government has set its sights on building a 150,000 b/d refinery in Takoradi.