Five firms shortlisted to buy stake in Zambia's oil refinery

IndeniThe move set to increase hydrocarbon opportunities in Africa. (Image source: Skeeze/Pixabay)Zambia has shortlisted five companies out of seven international bidders to buy a stake in Indeni Petroleum Refinery, the only oil refinery in the southern African nation

Following Africa’s booming activities in oil and gas, Zambia is set to expand its exploration and production capacities and upgrade its downstream sector. According to IDC, the Indeni refinery, with a current capacity to produce about 24,000 bpd of petroleum products, requires equity partner to upscale production capacity to meet the demand.

Among the five oil and gas companies that have been shortlisted include Britain's Glencore Energy Ltd, China Petroleum Technology and Development Corporation, Sahara Energy Resources Ltd, Joint Stock Company Global Security of Russia and Beijing Huiersanji Green Chem - Tech Co Ltd and Avic International Holding Corporation Consortium of China.

The Industrial Development Corporation (IDC) said that the five firms are selected after a detailed scrutiny by Africa’s oil and gas experts. The companies are now required to provide financial and technical proposals, said IDC.

In March 2018, seven international companies submitted bids to acquire a stake in Zambia’s Indeni refinery. The goal is to increase oil production capacity of Zambia’s sole oil refinery. The move is in line with Zambian government’s industrial and commercial investment agenda to attract international oilfield services companies to invest in southern African nation’s oil and gas prospects.

Zambia has focused on boosting oil and gas production to meet the domestic demand as well as to export to neighbouring African nations and international markets, thus adding value to its sustainable development agenda.

Currently, Indeni has a design capacity of 1.1mn MT per annum and achievable capacity of 850,000MT per annum, which significantly falls far short of the country’s combined demand of petrol and diesel that currently stands in excess of 1.7bn litres per annum.

IDC hopes that the shortlisted companies will play a crucial role in upgrading this scale and increase oil and gas activities in Zambia and in the region.

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