BP Urges South Africa to Consider New Refinery Alternatives

BP has asked the South African Government to consider all options before building a new 400,000bpd oil refinery at Coega in the Eastern Cape.

The government has already given licence to state-owned PetroSA to build the $9bn Mthombo refinery that is expected to reduce the country’s dependence on imports.

BP South Africa chief executive Sipho Maseko said the government must consider expansion of existing refineries before embarking on the construction of a full-blown greenfield refinery.

“There is enough surplus refinery capacity in the world and it is likely to remain so beyond 2020,” Maseko said.

“It therefore makes no sense to burden South African taxpayers when better and cheaper options are available than building a new, expensive refinery.”

BP and other oil companies that largely own the nation’s four refineries are expected to benefit from the delay in the new project as its output would be sufficient to meet South Africa’s liquid fuel needs.

South Africa Department of Energy spokesman Bheki Khumalo said the refinery was part of the government’s long-term energy security plan and South Africa could not continue to rely on imports.

The Mthombo plant is expected to come online in 2014.