Black Rhino signed a “framework agreement” in August with South Sudan’s government for the proposed 50,000 barrel-a-day facility, company President Dan O’Shea said. The refinery in the country’s northern Upper Nile state would take about three years to build and cost $2 billion to $3 billion, he said.
The planned refinery “is intended to fill the gap to supply the local market in full,” O’Shea said in a Dec. 9 phone interview from New York. A “significant amount of refined products” could be shipped to Ethiopia, in exchange for electricity that would power the facility. A final accord will probably be signed in the second quarter of 2014, he said.
South Sudan, which exports about 220,000 barrels a day from its oilfields via pipelines across Sudan, is building refineries as it seeks to save foreign exchange it now uses to buy diesel from neighboring countries.
The country imports as much as 40 million liters (10.6 million gallons) of fuel a month from Kenya, Paul Adong Deng, managing director of state-owned Nile Petroleum Corp., said in an Oct. 29 interview in the capital, Juba. About 80 percent of imports are diesel and 20 percent gasoline.
Refineries are already planned in the oil-producing states of Unity and Upper Nile. The first, a 5,000 barrel a day facility in Bentiu, is a joint venture between Nile Petroleum and Russia’s Safinat. Construction will begin by the end of 2013, Russian Ambassador Sergei Shishkin said Nov. 27.
South Sudan has sub-Saharan Africa’s biggest oil reserves after Nigeria and Angola, according to BP Plc data. Its low-sulfur crude, prized by Japanese buyers as a cleaner-burning fuel for power generation, is pumped mainly by China National Petroleum Corp., Malaysia’s Petroliam Nasional Bhd. and India’s Oil & Natural Gas Corp.
South Sudan seceded from neighboring Sudan in July 2011 and took three-quarters of the formerly united country’s oil output. A dispute between the two nations over export revenue halted South Sudanese production last year, cutting the country’s economy by half to $9.34 billion, according to World Bank data.
To contact the reporter on this story: Mading Ngor in Juba at email@example.com
To contact the editor responsible for this story: Antony Sguazzin at firstname.lastname@example.org