Government’s plan to revive critical South African industry

South Africa’s Central Energy Fund (CEF) outlined plans to revive oil-refining capacity, with local crude processing set to at least triple, potentially reducing dependence on fuel imports. 

The CEF intends to rebuild the Sapref refinery south of the port city of Durban, which was idled after the 2022 floods in KwaZulu-Natal damaged the facility.

The CEF is targeting a daily throughput of 400,000 barrels, it said in a statement on Wednesday.  

It would then raise this to 650,000 barrels daily, subject to investment and approvals. It didn’t provide details on funding and timing. 

Redeveloping the refinery would boost local processing capabilities and reduce reliance on imports, which account for about 61% of supply, up from 22% in 2019. 

The continent’s biggest economy has only two operational crude-refining facilities: Sasol’s Natref facility and Astron Energy’s plant in Cape Town, with a combined capacity of about 208,000 barrels a day.

Coupled with Sasol’s coal-to-liquids plant at Secunda that processes about 150,000 barrels daily, the CEF’s plan would more than double total refining capacity in South Africa. 

“South Africa cannot afford to lose sight of the strategic importance of domestic refining capacity,” CEF Chief Executive Officer Tshepo Mokoka said. 

In the meantime, the fund will use existing tanks and transfer infrastructure to bolster imports, the fund said.