PetroSA, South Africa's National Oil Company, has entered into a joint study agreement (JSA) with the China Petrochemical Corporation, known as Sinopec Group, for the new Mthombo refinery.
The proposed crude oil refinery will be built in the Coega Industrial Development Zone in the town of Port Elisabeth.
PetroSA and Sinopec have chosen Sinopec Engineering Incorporated to undertake the study on behalf of the two companies.
The study will determine final cost and capacity of the refinery, which is expected to produce 400,000 barrels per day of oil and cost between $9bn and $10bn.
PetroSA Group CEO Nosizwe Nokwe said the JSA with Sinopec would significantly advance the realisation of Project Mthombo.
"This JSA will align the partners and develop an integrated owner's team, in line with best practices for the planning and executing of this mega project," Nokwe said.
PetroSA said commissioning of the Coega refinery is scheduled between 2018 and 2020.