Page 18 - DMEA Week 40

DMEA REFINING DMEA

Trinity in talks on $500mn

refinery in South Sudan

SOUTH SUDAN SOUTH Sudanese fuel supplier Trinity Energy has obvious is South Sudan, next door is Ethiopia,
entered into talks with financiers and contractors Sudan and the surrounding countries are the
Trinity said it had to build a $500mn oil refinery at Paloich, its CEO potential market.”
engaged Chenex as the Robert Mdeza told reporters on October 6. Trinity will look to partners with banks to
project’s manager. US firm Chemex will serve as the project’s finance construction, using a mix of equity and
manager, while preparation work will be funded credit funding.
by the African Export-Import Bank, Mdeza said. South Sudan gained independence from
Neither entity has confirmed their involvement Sudan in 2011, taking the bulk of the former
in the project. combined country’s oil wealth with it. Since then
“We are already making steady progress it has been working to expand its refining capac-
towards our refinery project. We have already ity to over 100,000 bpd, although NewsBase sees
identified and secured land for the refinery in this target as overly ambitious.
Paloich. We have engaged Chemex of the US as The country’s current five-year strategy calls
the project manager,” he said. “Separately we are for the construction of five refineries close to its
close to tying up project preparatory work financ- oilfields. It also involves the rehabilitation of the
ing from Afrieximbank, and this will aid in the existing 5,000 bpd Bentiu oil refinery, which was
engineering and design work for the facility.” reported as near completion in August.
Operations will start in two to three years and Trinity won a contract to build an oil refin-
the refinery will handle 40,000 barrels per day ery near Paloich in 2018. The company, which
(bpd) of crude from locally produced oil in the controls 40% of South Sudan’s fuel supply,
oil-rich Upper Nile region. This capacity could also plans to build a 50mn litre storage site
be raised to 200,000 bpd in the future, supplying for refined products beside the Juba-Bahr-el-
customers across the East Africa region. Ghazal highway, Mdeza said. In addition, it
“So we have the source, we will refine it right wants to distribute fuels in Kenya, Uganda,
near the sources, and from there we will find the Tanzania and the Democratic Republic of
market,” Mdeza continued. “One market that is Congo (Kinshasa). ™

PETROCHEMICALS

Aramco, Sumitomo provide $2bn

loan to petchem venture

SAUDI ARABIA SAUDI national oil giant Saudi Aramco and day (bpd) refinery and petrochemicals units
Japan’s Sumitomo Chemical have pledged a from February 24.
The loan will $2bn loan to their PetroRabigh petrochemicals Product margins were also weaker owing to
cover a shortfall in venture to cover a shortfall in its working capital. “challenging economic conditions” exacerbated
PetroRabigh’s working Sumitomo, which owns a 37.5% in the ven- by COVID-19, it said.
capital. ture, said on October 1 it would issue its pro-rata According to Sumitomo, PetroRabigh still
share of the loan, worth $750mn. Aramco will has $4.6bn in outstanding debt, having spent
presumably cover the remaining $1.25bn. $9.1bn on a petrochemical expansion project
The shortfall in capital has been caused by a completed in 2018. The venture will continue
rapid deterioration in market conditions, Sum- repaying its debts using its operational cash flow,
itomo said, as well as the cost of maintenance Sumitomo said.
work. The global petrochemicals market was fac- PetroRabigh is based in western Saudi Ara-
ing a glut even before the coronavirus (COVID- bia, operating a complex 150 km north of Jiddah.
19) crisis began, owing to weaker-than-expected Its units are capable of producing 700,000 tonnes
demand in key markets. Many producers have per year of polypropylene, 600,000 tpy of linear
seen losses deepen since the pandemic took hold. low-density polyethylene and linear low-density
PetroRabigh booked a loss of SAR1.44bn polyethylene, 300,000 tpy of high-density poly-
($384mn) in the second quarter, versus a ethylene, 160,000 tpy of low-density polyethylene,
SAR308mn loss a year earlier. The company 400,000 tpy of benzene and 1.3mn tpy of paraxylene.
blamed this on six months of maintenance, PetroRabigh has to disclose its results because
which led to the closure of its 400,000 barrel per 25% of its shares are publicly traded. ™

P18 www. NEWSBASE .com Week 40 08•October•2020