Thursday, May 19, 2011

New Accra Refinery Project Gains Momentum As Tullow Official Slates Tema

BMI View : The alleged inability of the Tema refinery in Ghana to process crude oil from the Jubilee field does not bode well for the proposed upgrade of the facility. As a result, a project to build a new 200,000b/d refinery in Accra may gain momentum.

The Tema Oil Refinery (TOR) in Ghana is apparently not fit to process crude produced at the country's offshore Jubilee field, according to Kwarteng Amaning, a petroleum engineer for Tullow Ghana cited by GhanaWeb. According to his statement, the crude produced is too sweet and light for the refinery to process, meaning that the plant would have to be retrofitted or a new refinery would have to be built to process Jubilee's crude. Amaning said that either option would cost around US$1bn and that this would not make economic sense considering that other discoveries offshore Ghana may hold different types of crude that would require a different refinery. BMI takes issue with Amaning's claims but we do see his statement as demonstrating Tullow Ghana's unwillingness to invest in upgrading Tema, which will boost the chances of a new refinery being built in Accra.

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