The company advertised the multi-million rand tender this week. CEO Sipho Mkhize said
that engineering partner would execute the feasibility, front-end
engineering design and project management through to commissioning of
the refinery, dubbed Project Mthombo.
“PetroSA believes that the
appointment of one strategic engineering partner to manage the various
project phases will provide enhanced focus and continuity,” he said.
The
company also announced that it had appointed KBC Advanced Technologies
as the project’s technical/commercial adviser and that it would appoint
Merchant Bank as its financial adviser shortly.
The Port
Elizabeth-based refinery would come on stream in 2014, and was seen as
a strategic investment to alleviate South Africa’s reliance on Durban,
which handled 75% of the country’s crude imports.
PetroSA head of new ventures Joern Falbe
commented that each phase of the project would be expected to meet
targeted milestones to ensure sustainability and alignment with the
company’s objectives in addressing South Africa’s strategic fuels
supply concerns.
The Energy Security Master Plan - Liquid Fuels,
gazetted by the Department of Minerals and Energy recently, recommended
that PetroSA procured at least 30% of all crude oil consumed in South
Africa. The initiative to build a new crude refinery is in part
response to this mandate.
Falbe added that PetroSA also
recognised that this mega-project must be fully leveraged in the
national interest to drive much needed engineering skills and supplier
development for the country.
“With this objective in mind, and
in addition to standard benchmarked commercial measures, key selection
criteria will require the engineering contractor to demonstrate their
ability, through commitment, proven capability and their global track
record to contribute to this national obligation.”
The South African government gave the project the official stamp of approval in June, when Minerals and Energy Minister Buyelwa Sonjica said in her budget vote that the State fully endorsed the project.
Project
Mthombo would be one of the biggest post-2010 investments in South
Africa. It was estimated that the project would generate about 8 000
direct jobs during operations and 39 000 indirect jobs.
It would also significantly improve South Africa’s fuels import bill.
“This
project will further redefine South Africa’s energy landscape. The
demand for automotive fuels in Southern Africa already exceeds the
local production capacity and South Africa is becoming increasingly
dependent on the import of refined automotive products,” Mkhize stated.
