South African state oil company PetroSA and China’s Sinopec Group have signed an agreement to boost exploration activity across Africa and to set up an oil refinery
The US$10bn Mthombo refinery project was planned for the Coega Industrial Development Zone outside Port Elizabeth in the Eastern Cape.
The agreement was signed during a meeting between President Jacob Zuma and Chinese President Xi Jinping in Pretoria recently.
Chairmen of the two companies, Benny Mokaba of PetroSA and Fu Chengyu of Sinopec, said in a joint statement, “The framework agreement enables the two companies to move forward this global-scale crude oil refinery project.”
According to South African daily Business Day, the refinery would pump approximately 360,000 bpd and create 27,500 direct and indirect jobs during construction and 18,000 jobs when it started operating.”
The agreement has followed the signing of a study agreement between the two companies in May last year.
Mokaba described the agreement as an important building block in bringing the project to fruition.
Mokaba said, “It gives PetroSA the opportunity to extend a mutually beneficial relationship with a major national oil company.”
As part of their growth plans, the companies have agreed to include the Industrial Development Corporation (IDC) in the next phase of the project’s development.
