South Africa could be heading towards a bitumen shortage in the first half of 2013 with the closure of three oil refineries
According to a report on news portal Ventures Africa, Engen, Caltex, and Sapref were all expected to shut down oil refineries in the country within the next five months to the end of May 2013, with bitumen output set to take a hit.
Bitumen, a form of petroleum and a by-product of the refining process, functions as a key material for road construction.
According to Philip Hechter, chairman of the South African Bitumen Society and CEO of Much Asphalt, the country will suffer a 20 per cent bitumen deficit pursuant to the refinery closures.
Hechter said, “This will put pressure on the system and demand will outstrip supply. The shortage will have to be managed by increase in imports.”
Imports will answer between 10 and 15 per cent of the demand deficit, leaving approximately a five to seven per cent shortfall, according to Hechter.
Much Asphalt has already put in place plans to import bitumen stock, with a shipment set to arrive next months with later shipments expected within the following month.
