Home to commercial offshore oil and gas reserves, the MSGBC region’s natural resources are set to drive downstream investment, while providing much-needed energy development to the West African region. Though still in its infancy, the region’s downstream industry represents a highly attractive investment destination owing to new crude oil and gas supplies brought online, rising regional demand and the introduction of local oil and gas products to the market in 2024.
With demand for gas rapidly expanding across the globe, the MSGBC region’s strategic proximity to European markets and sizable resource portfolio make the basin a competitive potential exporter and producer of refined petroleum products. Having placed LNG export-import infrastructure at its core, projects like the Greater Tortue Ahmeyim conventional gas development in Senegal and Mauritania are well-positioned to meet regional demand for transitional energy sources such as natural gas, while new oil refining projects are launched following the production of first oil from Senegal’s Sangomar field development in June.
West Africa’s oldest refinery – the Société Africaine de Raffinage (SAR) refinery in Senegal – is undergoing major upgrades, as it currently meets 50% of market demand in terms of energy production. The Senegalese government is in discussions with pan-African finance institution the African Export-Import Bank to obtain $500 million in syndicated finance to increase annual production from 1.5 million to 3.5 million tons of refined petroleum products. In addition to the SAR refinery, Senegal is exploring additional downstream projects, including a liquefied petroleum gas storage facility, which is currently under feasibility studies. Last week, SAR signed an agreement with Chinese firm Sedin Engineering to explore the construction of a second refinery in-country and a petrochemical plant to produce high-value products like chemicals and plastics.
Responsible for crude oil refining and distribution in Ivory Coast, Société Ivoirienne de raffinage (SIR) finalized a $656-million debt restructuring finance as part of the country’s range of economic reforms to continue its growth. The refinery is looking to modernize its current facility to meet international standards, as well as rising regional fuel demand. Initially developed with a refining capacity of 700,000 tons per year, expansion activities have resulted in SIR achieving a capacity increase to 3.8 million tons.
In January this year, Guinea-Conakry announced it is studying proposals to construct a new oil terminal in the country’s capital before the end of the year. It was announced that the project will be developed through a public-private partnership, and that studies are ongoing to determine the quantity of reserves in the country. Meanwhile, development of Guinea-Conakry’s Kondarian depot, which began construction in March 2023, is currently 30% complete, while feasibility studies are currently ongoing for the Moribaya depot, which is currently in its fundraising phase.
Coupled with a favorable regulatory environment and a strong pipeline of infrastructure projects, MSGBC countries are well-suited to foster partnerships with regional governments and private sector players. With a combined oil consumption rate of just under 10,000 barrels per day, the region offers a strong potential return for investors seeking to participate in its emerging downstream sector. Ongoing projects to upgrade refineries, develop new processing facilities and promote the marketing and distribution of oil and gas products are poised to alleviate energy poverty in the MSGBC region, while balancing both energy security and transition needs.
In support of the development of the refining, trade, distribution and sale of oil and gas products in West Africa, the African Refiners and Distributors Association (ARDA) will participate at this year’s MSGBC Oil, Gas & Power 2024 conference – taking place in Dakar from December 3-4. Through the participation of the organization’s Executive Secretary Anibor Kragha, ARDA will leverage the conference’s platform to advocate for the need to accelerate investment across the downstream sector so that Africa can improve energy security and self-reliance through upgrades to existing refineries, the construction of new facilities and the establishment of regional distribution networks.
Explore opportunities, foster partnerships and stay at the forefront of the MSGBC region’s oil, gas and power sector. Visit www.msgbcoilgasandpower.com to secure your participation at the MSGBC Oil, Gas & Power 2024 conference. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com
