Page 16 - DMEA Week 28 2022

DMEA NEWS IN BRIEF DMEA

SUPPLY REFINING Crude oil that is destined for Natref is
offloaded in Durban port, where it is first
Algeria provides more gas Sasol declares force stored and then pumped around 600km to the
refinery. The company did not immediately
to Italy starting next week majeure as stalled oil confirm what had caused the delay. But it is
not the first time Sasol has had to declare a
Algeria’s state oil utility Sonatrach will shipments shut Natref force majeure in recent months due to supply
reportedly provide Italy with an additional chain hassles affecting its routes. In April, it
4bn cubic metres of gas in 2022, in addition to Sasol has declared a force majeure on the declared a force majeure relating to the export
the 21 bcm agreed earlier by both countries, supply of petroleum products after key of some chemical products due to heavy
Reuters said on Friday, July 16 citing industry refinery Natref was forced to shut down on rainfall and floods in KwaZulu-Natal, Fin24
sources. Friday due to delays in the arrival of crude oil previously reported.
The additional supplies are expected to shipments. At the time, it said production rates at
start being delivered to Italian customers, Sasol said shipments were expected to start some of its plants in Sasolburg had been
including Eni, by next week. arriving on Saturday 16 July, which would impacted due to damage to the Sasolburg-
The announcement comes two weeks see crude oil feed beginning to be restored to Durban railway infrastructure.
after Sonatrach indicated that it could shift to Natref. The Natref refinery €“ which was
increasing gas prices on European customers, The aim is to see Natref running at full commissioned in 1971 €“ has undergone
including Italy, Spain and Portugal, under capacity by month end. a number of upgrades during its lifespan,
the long-term contracts reliant on the single Force majeure is a mechanism that frees including an expansion project to increase
pricing index, as the utility evaluates options parties from contractual obligations in the its capacity by around 25% to some 108 000
to maximise its returns from the global case of an extraordinary event that prevents barrels per day. It is a joint venture between
surging prices for energy. them from performing as usual. Sasol mining and TotalEnergies.
Europe, which is largely dependent on “Sasol Oil has declared a Force Majeure The two companies have warned that it
Russian gas, has suffered limited energy on petroleum products as a result of delays in could become unsustainable due to clean fuel
supplies (less than 40% of normal levels) the arrival of crude oil shipments which are regulations, which they have said could make
since Russia invaded Ukraine and the West beyond Sasol Oil’s control. These delays have operations unviable in the future.
imposed sanctions against Moscow. At the impacted availability of crude oil feedstock But the news of Natref’s supply headache
same time, Algeria’s role as a gas supplier to for processing at Natref, which necessitates comes amid rising concerns over the state of
some European countries, including Italy the shutdown of its Natref refinery,” a Sasol South Africa’s refineries. Energy consultant
and Spain, has increased. The North African spokesperson told Fin24 on Saturday. Citac recently warned that amid rising fuel
country recently signed a gas deal with Italy “In the circumstances, Sasol Oil will not be costs, the country’s petroleum imports could
to step up gas supplies. Europe is worried in a position to fully meet its commitments triple by 2023 compared to pre-pandemic
that the rising demand for gas in winter for on the supply of all petroleum products from levels, as increasing numbers of domestic
warming purposes will cause a real problem July 2022.” refineries are forced to shut their doors. South
amid a shortage of fuel supplies. The situation would hopefully be resolved Africa needs some 25 billion litres of fuel a
Algeria’s total gas exports stood at 54 bcm soon, the spokesperson added. year and already meets more than half that
in 2021, according to official figures. Energy “Sasol Oil is engaging industry role players demand through imports.
revenues are expected to rise to $50bn by end- as well as affected customers regarding the Natref’s shutdown on Friday follows hot on
2022, from only $35.4bn last year. product shortfalls and will communicate the heels of several refineries in SA that have
NEWSBASE on an ongoing basis on measures taken to had to suspend operations either temporarily,
stabilise supply from Natref refinery.” indefinitely, or permanently.

P16 www. NEWSBASE .com Week 28 14•July•2022