Optimism in Africa’s downstream industry
Image: Siemens – Global
The African downstream oil industry has seen a $30-billion investment push in logistics, distribution, storage terminals, import facilities and retail marketing in recent years.
This is according to reports from the fourteenth annual conference of the African Refiners and Distributors Association (ARA), held in Cape Town this week.
Africa’s high demand for energy is expected to create positive effects in the African downstream oil industry, with speakers at the conference forecasting a four percent increase in Africa’s gasoline and diesel demand yearly – above BP’s Global Energy Outlook projection of 1.3 percent yearly.
Gas production and liquefied natural gas (LNG) production is projected to increase by two percent and one percent, respectively.
“Our expectation is that the onset of LNG production will drive downstream growth,” said Standard Bank head of oil and gas, Paul Eardly-Taylor.
Nigeria has seen increased investments due to the rapidly progressing Dangote refinery, with refining units soon to be installed. In Egypt – Africa’s largest refiner – the Egyptian General Petroleum Corporation has announced a mammoth investment program for its eight refineries in addition to the forthcoming $4.5-billion, privately financed project at the Egyptian Refining Company.
Côte d’Ivoire Energy Minister, Abdourahmane Cissé, presented during the conference a $674 million new finance package for the Societe Ivoirienne de Raffinage refinery in Abidjan and announced planned upgrades to meet the ARA’s AFRI-4 specifications.
Both Algeria and Uganda have made progress in upgrading and advancing their refining systems, and according to African Development Bank’s chief natural resources officer, Rose Mwebaza, investors must prioritize developing skills in Uganda’s new oil sector – Uganda has the potential to create 150,000 new jobs, where 77 percent of the population are under the age of 30.
Mwebaza also called for mutual transferability of skills from countries like Nigeria, South Africa and Ghana.