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African countries will require $16 billion for upgrade of 36 refineries

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African countries would require about $15.7 billion to upgrade existing 36 refineries on the continent, the African Refiners and Distributors Association (ARDA) has said.

It said this would be needed if countries within the continent desire to meet the planned Sulphur level in petroleum product content.

In a breakdown, the Association’s Executive Secretary, Mr Anibor Kragha, who spoke at a workshop on ‘Upgrading African Refineries to Produce Cleaner Fuels’, said North Africa with 17 refineries would require capital expenditure of $5.955 billion for refineries upgrade while West and Central Africa with 12 refineries would need $6.285 billion.

For East Africa and Southern Africa with seven refineries he said a total of $3.415 billion would be needed.

According to him, the African Union (AU) and the African Refiners and Distributors Association (ARDA) had planned an initiative called AFRI-6, aimed at reducing Sulphur content in fuels to 10 parts per million (ppm) in the coming years.

He said without urgent steps on adopting uniform fuel specifications across the continent, health and environmental challenges could worsen existing problems even as the continent’s population projection is expected to grow exponentially.

To this end, he said the AU and ARDA were collaborating on the adoption of AFRI Fuels Roadmap, listing new process units required to improve key fuel specifications to include; Naptha Hydrotreater, NHdT, Diesel Hydro-desulphurisation, DHDS, Benzene Extraction and Sulphur & Hydrogen Plants.

He stated that “major urban population growth would result in increased pollution.”

On his part, Director of Project and Structured Finance at the Honeywell UOP, Robert Doyle, stated that attracting capital for investment in the oil and gas sector remained a challenge due to perceptions of country risk, currency convertibility, economic growth factors, regulatory challenges, etc.

He said: “International lenders have been traditional sources of capital for large mega-projects but it can be a challenge to attract them for smaller opportunities with less recognised sponsor names.”

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