PetroSA in Angolan oil refinery bid

Sep 29, 2005 02:00 AM

PetroSA, the state oil and gas company, could take a stake of between 3 % and 10 % in Angola's proposed $ 2 bn (R 12.9 bn) oil refinery at Lobito, PetroSA chief executive Sipho Mkhize said.
Sonangol, the Angolan national oil company, had invited PetroSA to tender for the stake along with two other companies, Mkhize said at the 18th World Petroleum Congress.

The downstream sector was not a key part of PetroSA's strategy, and the oil and gas producer would "rather be in gas-to-liquids [GTL] than in the refineries", Mkhize said. But the company decided to tender for a stake in Lobito to boost its chances of securing opportunities in Angola's upstream sector.
Due to shortages of and huge growth in demand for refined products, "companies that participate in downstream get favourable access to exploration and production", Mkhize said.

PetroSA is bidding for an onshore block in Angola. Mkhize hoped the company's participation at Lobito would help it secure exploration rights in other Angolanblocks.
Angola, the second-largest producer of oil in sub-Saharan Africa after Nigeria, is expected to announce soon the winning bidders of licences for seven new blocks, most of them offshore. The Lobito refinery could boost Angola's refining capacity by 200,000 bpd from 65,000 bpd. It is proposed that Sonangol take a 40 % stake in the new refinery, a private Angolan investor 10 % and foreign players 50 %.

Exploration and production is a pillar of PetroSA's growth strategy, along with transformation, securing feedstock for its Mossel Bay GTL plant and developing and operationalising GTL technology.
The company has already acquired a 40 % interest in a producing facility in Nigeria and is securing additional reserves in Gabon, Equatorial Guinea, Sudan, Nigeria and Algeria.

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