Iran's Potential Investment in a New Refinery Project in South Africa

Pretoria is seeking Iranian investment in a new refinery project in South Africa. According to Reuters, South African energy officials stated on Friday, May 18, that Pretoria is looking for investors from West Africa and the Middle East, including Iran, for this project. Mamoloko Kubayi, the Minister of Energy in South Africa, told the country's parliament that the government expects to make a decision regarding the construction of this refinery, which has been under consideration for nearly a decade, by December. 'PetroSA', South Africa's national oil company, has proposed building a refinery with a daily capacity of 400,000 barrels on the country's eastern coast, but the government shelved this $10 billion project in 2010 due to a lack of investment partners. The Minister of Energy also stated that 'the construction of this refinery is currently urgent as the country's oil imports are increasing.' She noted that 'public-private partnerships for the development of this refinery, of which the government will be the major shareholder, are preferred,' adding, 'until the new refinery is completed, South Africa will import more than a third of its fuel needs.' Meanwhile, Tshepo Makobela, Deputy Director-General of the South African Ministry of Energy, told Reuters that officials are negotiating with countries and companies from the Middle East and West Africa for the construction of this refinery. In response to the question of whether Iran is among the countries being considered, he said, 'At this stage, we have not ruled out any country.' Last year, Iran announced that it was negotiating with several countries to establish, invest in, or purchase shares in refineries, provided that the oil from those refineries is purchased from Iran. The Deputy Director-General of the South African Ministry of Energy also mentioned that no decisions have yet been made regarding the capacity of this refinery or its establishment costs. Royal Dutch Shell, BP, Total, and Sasol are major companies operating in South Africa, which is the most industrialized country in Africa. In May 2012, South Africa imported about 68,000 barrels of oil per day from Iran. The following month, due to Western pressure on Iran's nuclear program, oil imports from Iran were halted. South Africa, which also buys oil from Saudi Arabia, Nigeria, and Angola, announced that following the lifting of sanctions in 2016, it decided to resume oil imports from Iran. According to Tembisile Majola, Deputy Minister of Energy in South Africa, the construction of this refinery will help the country control vital resources, including gasoline, diesel, and jet fuel. The South African Minister of Energy stated that the government has decided to increase the participation of major companies in crude oil imports, focusing on West African oil, which accounts for more than half of South Africa's imports. The implementation of this strategic decision will be determined after consultations with major oil companies this year.