Sapref to pause operations indefinitely in March

As shareholders consider their options – with a sale ‘being the most preferred’.
Image: Supplied

South Africa’s largest refinery, Sapref, a 50/50 joint venture between oil majors BP and Shell will pause operations indefinitely from March 22 as its owners consider selling the plant.

Situated in the east coast city of Durban, Sapref has a nameplate capacity of 180 000 barrels per day and accounts for around 35% of the refining capacity in Africa’s most industrialised economy, a net importer of petroleum products.

“The decision has been taken to allow an informed finalisation on the various options available to the shareholders, a sale option being the most preferred,” said the statement.

“Until decisions about the future of the plant have been made – including a possible change of ownership – the Sapref shareholders are unable to commit to further investment in the refinery,” the operators said.

In September, the South African Petroleum Industry Association body (Sapia) warned that the country’s refinery capacity could become obsolete within two years as the government pushed to introduce rules meant to reduce sulphur emissions from 2023.

Sapia, which represents oil firms such as BP and Shell that operate local refineries, has deadlocked with government in talks to finance the upgrade of six refineries to cleaner fuels at an estimated cost of $3.9 billion.

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