West Africa, a heavyweight in oil production, aims to boost its oil refining game. With an ever-growing domestic demand for fuel, the region hopes to slash its hefty fuel import bills by refining its own crude. Sadly, they’re selling their crude oil for less than its potential worth.
New refineries are in the plans for several West African nations. The idea is simple: become self-reliant and maximize profits from oil exports. But many hurdles could stand in their way, from financial woes to tricky politics.
One standout project is Nigeria’s Dangote refinery. Set to be the world’s largest of its kind, it promises to refine 650,000 barrels daily. Owned by business magnate Aliko Dangote, it opened its doors in 2023, offering everything from gasoline to jet fuel. But critics wonder: with Nigeria’s power woes and fragile security, is such a big project a wise investment? The push for green energy worldwide and other rival refineries can’t be ignored.
Angola, another oil-rich nation, has grand refining plans too. Right now, they’ve got a single refinery in Luanda handling 39,000 barrels daily. But there’s more on the horizon. Two big projects in Cabinda and Soyo will bump this up by another 110,000 barrels. UK’s Gemcorp and Angola’s Sonangol are collaborating for the Cabinda project, while the Soyo one sees Chinese firms joining with Sonangol. Yet, unstable oil prices and Angola’s own challenges might prove to be stumbling blocks.
Let’s not forget Ghana. With a current capacity of 45,000 barrels in their Tema refinery, they’ve got their sights set on an upgrade. Aiming for a massive 150,000 barrels daily, this new project sees Chinese investors leading the charge. But again, concerns loom over its environmental footprint and overall viability, especially given the green energy wave and regional competition.
In short, while West Africa dreams big with its oil refining ambitions, a sea of challenges awaits. The global oil market’s ever-changing face means the region must stay agile and resilient to thrive truly.
Source: African Energy
