South Sudan: Oil Firm Bids to Set up a U.S.$500 Million Regional Refinery

South Sudanese oil marketing giant Trinity Energy Ltd is set to inject $10 million worth of new investments in its Kenyan operations and also plans to build a $500 million crude oil refinery in South Sudan to serve the region with refined petroleum products.

The firm, which controls close to 40 percent of the South Sudanese oil market, is planning a 40,000 barrels per day (bpd) modular refinery at Paloch in the oil-rich Upper Nile State, with the potential of expanding capacity to 200,000bpd, as well as petroleum storage facilities at Nesitu, in the south of the country.

South Sudan has the third-largest oil reserves on the continent after Libya and Nigeria, estimated at 3.5 billion barrels, with much of it yet to explored.

The refinery, to be built by American firm Chemex, is expected to be operational in two to three years, with plans to start distribution of refined petroleum products to Kenya, Uganda, Tanzania, and the Democratic Republic of Congo by road, owing to the absence of railway and pipeline connectivity between these countries.

EastAfrican has learned that the feasibility study and the designs for the proposed refinery have already been concluded with Afreximbank together with big regional banks operating in Juba expected to provide financing.

"We are already making steady progress towards our refinery project. We have already identified and secured land for the refinery in Paloch. We have engaged Chemex of the United States as the project manager for this project.

Separately we are close to tying up project preparatory work financing from Afreximbank and this will aid in the engineering and design work for the facility," the firm's chief executive Robert Mdeza told The EastAfrican in an interview.

"Various discussions are ongoing with financiers for the various facets of our business. We have opted for a segmented approach so that we can kick off with the low-hanging opportunities such as our working capital requirements as we work our way towards financing for the larger projects like the refinery," he added.