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Oil Refining in ECOWAS
Oil and Gas Author
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By Oil and Gas Author
Published on 09/4/2006

West Africas petroleum refining capacity is concentrated in Nigeria. Nigerias refining capacity is currently insufficient to meet domestic demand, forcing the country to import petroleum products. Nigerias state-held refineries (Port Harcourt I and II, Warri, and Kaduna) have a combined nameplate capacity of 438,750 bbl/d, but problems including sabotage, fire, poor management and a lack of regular maintenance contribute to the current operating capacity of around 214,000 bbl/d. The Nigerian government is granting permits to build several independently-owned refineries in Nigeria. Sapele Petroleum Limited is waiting for final approval to construct a $105-million, 120,000 bbl/d oil refinery in Delta State. The refinery is one of the more probable to be built and could save Nigeria as much as $2 billion in costs for refined petroleum imports. Other ECOWAS refineries are located in CÔte dIvoire(Abidjan, 65,200 bbl/d); Ghana (Tema, 45,000 bbl/d); Liberia (Monrovia, 15,000 bbl/d); Senegal (Dakar, 27,000 bbl/d) and Sierra Leone (Freetown, 10,000 bbl/d). CÔte dIvoires refining facilities consist of the 65,200-bbl/d SIR refinery and an adjacent 10,000-bbl/d asphalt plant (SociÉtÉ Multinationale de Bitumes-SMB) in Abidjan. An oil pipeline connects the SIR refinery to the Lion and Panther fields. The refinery also receives crude oil from Nigeria. The state currently owns 47.27 percent of SIR, and expects to retain a 10 percent interest after privatization. Burkina Faso owns a 5.39 percent stake in SIR, and Total, Shell, ExxonMobil and ChevronTexaco own the remainder. The government of Ghana plans to partially privatize its Tema Oil Refinery (TOR) in 2006 in order to raise money for infrastructure developments in the country. In addition, plans are being made to increase TORs capacity to 100,000 bbl/d. Currently, TORs 45,000 bbl/d capacity meets about 80 - 85 percent of Ghanas demand for petroleum products. Ghana hopes to raise $6 million from the sale of TOR and other state-run businesses.

West African Gas Pipeline Project

The most significant natural gas development project is the West African Gas Pipeline (WAGP) project. The WAGP will traverse 620 miles both on and offshore from Nigerias Niger Delta region to the Volta River Authoritys power plant at Takoradi, Ghana. The $600 million WAGP will initially transport 120 MMcf/d of gas to Ghana, Benin and Togo. In September 2005, WAGP began laying the 353-mile main offshore segment of the pipeline offshore Ghana. The pipeline is being laid approximately 12 miles offshore at a rate of up to two miles per day. Tie-in points will take natural gas to metering and custody transfer stations at Lome in Togo and Cotonou in Benin. Completion of the pipeline installation is projected for December 2006. Natural gas deliveries are expected to be at 400 MMcf/d when the pipeline is functioning at its capacity (approximately 15 years after construction). In February 2003, the four nations involved in the WAGP signed an agreement on the projects implementation. The treaty, which is for a 20-year period, provides for a comprehensive legal, fiscal and regulatory framework, as well as a single authority for the implementation of the project. The WAGP partners are ChevronTexaco with 36.7 percent, NNPC with 25 percent, Shell with 18 percent, Ghanas Takoradi Power Company with 16.3 percent and Societe Beninoise de Gas and Societe Togolaise de Gas each with a 2 percent interest.