Page 13 - DMEA Week 16 2020

DMEA
NEWS IN BRIEF
DMEA
Sasol suspends production
because of low gasoline
demand
Sasol is prioritising supply of chemicals within South Africa and a reduction in Synfuels chemicals demand is not expected.
Production at Sasol’s fuel refinery Natref was suspended due to an unprecedented decline in fuel demand since the start
of the national lockdown, the company announced.
Natref, the inland crude oil refinery located in Sasolburg, is operated in partnership with Total South Africa.
Sasol announced the step in a statement to the Johannesburg Stock Exchange.
Because of the lockdown, the country has seen a sharp decrease in demand for fuel. Much of South Africa’s industrial production has been halted or placed into care and maintenance for the shutdown period. Companies having instructed staff to work from home have also influenced the sale of fuel significantly.
Sasol, which has also been hit hard by the recent drop in oil prices, now expects liquid fuels sales volumes to be approximately 50 to 51mn barrels for the 2020 financial year, lower than its previous expectations of 57 to 58mn barrels (approximately 7.3 to 7.4mn tonnes of synfuel), reports Review Online.
Sasol will continue with its chemicals production, within prioritised parameters which include the daily reduction rates at Secunda’s synthetic fuels operations with approximately 25%, to meet the current market demand. Synfuel or synthetic fuel is a form of liquid fuel made from coal in South Africa. Sasol is the world’s biggest producer of motor fuel from coal.
“The country, as well as strong export demand currently for chemicals, including sanitisers, will be met,” said Alex Anderson, head of group media communications.
Sasol is prioritising supply of chemicals within South Africa and a reduction
in Synfuels chemicals demand is not expected. Over the past few weeks, Sasol has experienced an increase in demand of nearly 400% for alcohol-based products and delivered close to eight million litres to the South African market and laboratories, production, marketing and supply chain teams are working around the clock to ensure a reliable supply of critical alcohol- based products to customers.
All Sasol’s mines are continuing
with operations, notwithstanding lower international demand. All external coal purchases are being significantly minimised
compared to planned purchases for this financial year.
“We will maintain these production
rates until further notice, while carefully monitoring the supply and demand balance. A further reduction in production rates
may be required depending on further developments in the fuels market,” Anderson said, adding that the management team was in the process of proactively identifying further measures to provide
an additional buffer against short term volatility.
“More detail on production volumes and updated guidance will be provided
in the company’s third-quarter business performance metrics report, to be released later in April. Safeguarding the health and well-being of employees and providing essential products to customers and stakeholders remains the company’s priority.”
Kuwait awards two oil refinery service contracts
Kuwait has awarded three contracts involving maintenance and engineering services for two of its oil refineries with a combined value of around KD145.6mn ($481mn), a newspaper in the OPEC member has reported.
One contract worth around 94.8mn Kuwaiti dinars ($313mn) for engineering and mechanical works at Al-Ahmadi refinery was awarded to the Kuwaiti Arabi Energy and Technology Company by the Kuwait Petroleum Corporation, the Arabic language daily Alanba said.
The second deal with a value of about 50.8mn dinars ($168mn) for Block-2 maintenance services for the 615,000-bpd Al-Zour refinery was awarded to Amco Engineering Services Company by the Kuwaiti Integrated Petroleum Industries (KIPIC), the report said.
Houston-based VFuels wins bid for a Modular Refinery feasibility, engineering and design study in Equatorial Guinea
The Ministry of Mines and Hydrocarbons, supported by its strategic partner Marathon Oil Corp., has awarded North American Company VFuels Oil & Gas Engineering
(VFuels) the feasibility study for the construction of a modular refinery in Punta Europa, Malabo. VFuels, which turned out
to be the winner of the tender, will be in charge of the feasibility study that will include the engineering and design of a 5,000 bpd modular refinery to supply refined products for domestic consumption. The study is expected to be delivered within 12 weeks of the contract’s signature.
This project is part of the initiative of the Year of Investment 2020 promoted by the Ministry of Mines and Hydrocarbons, which is seeking investments for a modular refinery in the continental region, storage tanks and the promotion of other projects derived from methanol, among others.
“This is an important step when it
comes to implementing this project with an important goal to prevent stock outs, and provide refined products of higher quality to economic operators and the general public,” stated H.E. Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons. “The experience and track record of VFuels in engineering and design of modular refineries at an international level, could be beneficial to this project and Equatorial Guinea,” added Minister Obiang Lima.
The award notably follows a meeting in January between H.E. President Obiang Nguema Mbasogo, H.E. Gabriel Mbaga Obiang Lima, Marathon Oil Chairman, President and CEO Lee Tillman and Executive Vice President Mitch Little during which Marathon Oil reiterated its commitment
to Equatorial Guinea and towards the development of the country’s Gas Mega Hub. Marathon Oil had then declared its support to construct a modular refinery in Punta Europa by undertaking a conceptual study on the Ministry’s behalf. Both parties had also agreed to immediately commence feasibility studies related to methanol to gasoline and other methanol derivatives, in coordination with the Ministry of Mines and Hydrocarbons.
Week 16 23•April•2020
w w w . N E W S B A S E . c o m
P13