Page 4 - DMEA Week 24 2022

DMEA COMMENTARY DMEA

Eyes on African refining

as fuel pinch persists

While progress is expected on several new, upgrade and rehabilitation projects in the African
downstream, current market conditions mean their completion cannot come quick enough.

AFRICA RISING prices and fuel shortages are being the 56-year-old facility an effective throughput
acutely felt across Africa and while major refin- capacity of 30,000 bpd.
ing projects are underway throughout the con- The IES said: “At a time this nation needs it
WHAT: tinent are underway, pressure to make progress most, the refinery has ceased to play any mean-
Experts have spoken of is building. ingful role in managing fuel price and supply
a new “golden age” of Speaking to Downstream MEA (DMEA) risks, while pockets of fuel shortages are recorded
refining, and if project this week, Ian Simm, Principal Advisor at con- with the price of fuel almost quadrupling in the
commitment is a good sultancy IGM Energy, said that Africa is in the past 6 and half years, stoking inflationary pres-
indicator, there are few midst of a “refining renaissance”. Indeed, with sures on the entire economy, as Ghanaians will
places where this is more projects equating to upwards of 1.5mn barrels attest.”
evident than Africa. per day (bpd) of new and overhauled capacity in It added: “After close to 6 years of poor
train, the downstream sector is attracting more management of this vital state institution, the
WHY: interest and investment than at any point during refinery sits idle and hopeless; losing out on the
Amid supply concerns the past decade. prospects of the Russian-Ukraine conflict, plus
and high fuel prices, However, chronic disrepair and a lack of prof- the potential of generating that synergy between
African interest in itability have taken hundreds of thousands of the upstream and the downstream sectors of the
refining is returning, barrels of capacity offline, and the additions are Ghanaian petroleum industry.”
while long-lead projects heavily weighted towards Angola and Nigeria, Earlier this year, Minister for Public Enter-
are beginning to provide with other countries likely to remain at the sharp prises Joshua Cudjoe said the government was
hope. end of the supply pinch for some time to come. seeking strategic partners willing to provide the
capital required to rehabilitate TOR, which still
WHAT NEXT: Time to save Tema requires extensive repair work.
Some units require Ghana’s sole refinery at Tema was described this
short-term upgrading, week as being in a “coma”, with the local Institute Rallying call
others need a lot more, for Energy Security (IES) calling for President Similar calls have been levelled at the govern-
but progress witnessed in Nana Akufo-Addo’s “urgent intervention” to ment of Morocco to revive the 200,000 bpd
recent months suggests save the favility. Societe Anonyme Marocaine de l’Industrie du
the tide may be turning. The 45,000 bpd Tema Oil Refinery (TOR) Raffinage (SAMIR) unit at Mohammedia, which
has been plagued by issues since an explosion at has been idle since 2015.
its distillation unit in early 2017 and was closed Calls for the facility’s reactivation have been
completely between July 2020 and January 2021. relatively common over the past few years but
Outages have been experienced at the crude have intensified amid accusations that the refin-
distillation and fluid catalytic cracking units, ery’s closure is a key factor in the high pump
while only one of the crude distillation unit’s prices faced by Moroccans.
(CDU) furnaces is currently operational, giving SAMIR’s doors closed as debts had left it

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