Senegal has revealed ambitious plans to commence the construction of a second oil refinery next year to boost domestic processing capacity. Furthermore, the country is seeking $2 billion to $5 billion in investment for the development of this scheme. This information on Senegal’s New Oil Refinery was revealed by the CEO of national refining company SAR on Thursday.
Also, Senegal has received financing offers from potential investors such as China, Turkey and South Korea. This was revealed by Mamadou Abib Diop to Reuters on the sidelines of an African energy conference in Cape Town.
Factsheet
Project name: SAR 2.0
Estimated cost: Seeking investment in the range of $2 billion to $5 billion
Planned capacity: An addition of 4 million tonnes per year of crude oil processing capacity.
Target construction start: Construction is planned to begin in the next year
Target start-up date: Targeted for 2029.
Feedstock source: Primarily crude oil from Senegal’s offshore Sangomar oil and gas field.
Key investors: offers and interest have been received from potential investors, including China, Turkey, and South Korea.
Source of the Refinery’s Feedstock
Furthermore, Abib Diop mentioned that feedstock for the new plant would come mainly from Senegal’s offshore Sangomar oil and gas field which is operated by Woodside Energy with national oil company Petrosen a minority shareholder. The field commenced production last year. It boast an annual capacity of 34.5 million barrels, or some 4.6 million tons.
Capacity of SAR Refinery
SAR which is West Africa’s oldest refinery processes 1.5 million tons of crude oil a year or approximately 30,000 barrels a day. However, it faces a domestic shortfall.
“This gap we will cover with a project named SAR 2.0. This means that we will add a second refinery site in order to add 4 million tons of processing capacity) annually,” Abib Diop stated.
Additionally, he stated that by a targeted 2029 production start-up date, SAR had set goals to achieve self-sufficiency in domestic supply of petroleum products, as well as potentially exporting to elsewhere in the region.
There is no final decision yet on where the new refinery will be located or if government would take an equity share in its development, Abib Diop told Reuters.
Similar Projects in West Africa
Similarly, Ghana is planning the construction of a massive Oil refinery that is expected to cost approximately $12 billion. With these projects springing up in West Africa, they will foresee a boost in economy growth. These growths will be as a result of generation of jobs during their development and operations.
