Page 4 - AfrOil Week 19 2022

AfrOil COMMENTARY AfrOil

Niger-Benin pipeline construction site (Photo: CNPC)

An African pipeline revival

A flurry of pipeline activity has broken out across the continent, with projects ranging

from ambitious to highly unlikely, as interconnectivity assumes some strategic focus

SEVERAL announcements have been made in (bpd) Indeni refinery by the end of the year,
recent weeks about new and re-imagined pipe- questions must be raised about where the piped
WHAT: line projects across Africa as consumer nations crude will be processed. Meanwhile, in March,
Pipelines have gained look to establish new supply arteries and pro- Lusaka agreed a deal to convert the 1,710-km
attention across Africa, ducers seek routes to new markets. Tanzania-Zambia oil (Tazama) pipeline to
as resource-scarce From West to East and South to North, transport refined petroleum products ahead
states look for supplies ambitious projects are in the works that could of the refinery’s planned closure. Almost all of
closer to home. improve interconnectivity, but alongside that Zambia’s feedstock and fuels – sourced from the
ambition lies abundant concern about the com- Middle East – is currently delivered from the
WHY: plexity of completing such large initiatives. Tanzanian port of Dar-es-Salaam via Tazama.
While spot prices often The announcement comes amid a signif-
proved favourable when Nam-Zam icant uptick in sentiment towards Namib-
oil prices were low, high Perhaps the most achievable of the projects ia’s upstream, with major finds having been
prices have led more
governments to lock in was announced last week by the Zambian gov- announced in recent months.
discounts in exchange for ernment. Minister of Energy Peter Kapala said Meanwhile, Zambia appears to be keeping
guaranteed offtake. that his country would sign a memorandum its options open, with Kapala saying last month
of understanding (MoU) with authorities in that he had successfully lobbied Angola to reo-
WHAT NEXT: Namibia next month for the development of an pen the possibility of the landlocked country
These ambitious projects oil and gas pipeline to connect the two. acquiring a stake in Sonangol’s long-planned
are unlikely to be all Kapala said that the conduit would run from (and long-delayed) Lobito oil refinery. Work
completed and those Windhoek to Lusaka, supplying gas for power is set to soon kick off on the $6bn, 200,000 bpd
that do will be highly generation and oil to reduce the cost of petro- plant, and Kapala announced that such a part-
capital-intensive. leum products in Zambia. nership would “guarantee Zambia consistent
However, with Zambia apparently intent on access to the supply of petroleum on a prefer-
shutting down its sole, 40,000 barrel per day ential basis.”

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