Report: Africa’s Refining Industry on Path to Recovery in 2023

Report: Africa’s Refining Industry on Path to Recovery in 2023

Emmanuel Addeh in Abuja

The reopening of some refineries in Africa and the gradual commissioning of new facilities will mark the recovery of the continent’s downstream industry in 2023, according to Hawilti’s African Refineries report.

While sub-Saharan Africa’s refining capacity is still under-utilised at some 40 per cent, Hawilti noted that recovery is on the horizon with the re-opening of South Africa’s Astron Energy Refinery (100,000 barrels per day and Ghana’s Tema Oil Refinery (45,000 bpd).

“Once both facilities are back in operations, the sub-continent will be able to utilise about half of its installed refining capacity,” it explained.

 However, the report stated that a much larger change is currently happening in Nigeria, with the commissioning of the 650,000 bpd Dangote Refinery. The facility was inaugurated on May 22nd just before President Muhammadu Buhari leaves office and has cemented Nigeria’s position as Africa’s leading refiner.

However, Hawilti expressed cautious optimism on the commissioning of the Dangote Refinery, pointing to the complex and lengthy process required to reach full production.

In its most recent report on Nigeria, Hawilti quoted the International Monetary Fund (IMF) stressing that it does not expect the refinery to reach full capacity right away, assuming a production of only 100,000 bpd in 2024 and 200,000 bpd in 2025.

Meanwhile, Nigerian modular refineries, it said, have managed to navigate the country’s challenging business environments and found ways to secure new feedstock options to run small-scale facilities.

Both the 1,000 bpd Edo Refinery and the 2,500 bpd Duport Midstream Refinery for instance, the report added, are currently receiving crude oil by trucks from a marginal field in the Niger Delta to support their operations.

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