Cost for PetroSA's Planned Mthombo Refinery Nearly Doubles to $11 Billion after Decision to Increase Capacity

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Petroleum Oil and Gas Corporation of South Africa (PetroSA) (Parow) has decided to build a 400,000- to 450,000-barrel-per-day (BBL/d) refinery in Coega, South Africa, worth about $11 billion instead of the $5.8 billion, 200,000-BBL/d plant originally planned in 2007. After a feasibility study was completed in May by KBR Incorporated (NYSE:KBR) (Houston, Texas), PetroSA decided to process additional crude oil from Nigeria or the Middle East to meet local demand for refined products.

PetroSA will select an engineering and construction firm in late 2008 to perform engineering, procurement, and construction services for the Mthombo refinery. Construction is expected to begin in early 2010 and last about 48 months.

PetroSA was formed in January 2002. The company owns, operates and manages the government's assets in the petroleum industry. In addition, it operates as an unlisted commercial entity under South African law.

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