Kenya Petroleum Refineries and Essar Oil to Expand Mombasa Refinery

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Researched by Industrial Info Resources (Sugar Land, Texas)--Kenya Petroleum Refineries Limited (KPRL) (Mombasa, Kenya) and Essar Oil Limited (BSE:500134) (Mumbai, India) plan to expand the 32,000-barrel-per-day (BBL/d) refinery in Mombasa to 88,000 BBL/d.

The companies have selected KBC Advance Technologies (Walton, England) to perform the feasibility study for the refinery expansion. The expansion will allow the refinery to process heavier crude oil from Uganda.

The expansion was originally estimated to cost between $400 million and $450 million, but this has increased to $1 billion. KPRL and Essar expect to select a company to perform engineering, procurement and construction services for the project. Construction is expected to begin in early 2013 and will take approximately 24 months to complete.

KPRL and Essar will construct several new units, including a hydrocracker, a continuous catalytic reformer, a diesel hydrotreater, a sulfur recovery unit and a hydrogen plant. The company also will revamp the existing crude unit and convert the semi-regen reformer to an isomerization unit.

KPRL was originally set up by Shell (NYSE:RDS.A) (The Hague, Netherlands) and BP (NYSE:BP) (London, England) to serve East Africa in the supply of a wide variety of oil products. The company was incorporated in 1960, under the name East African Oil Refineries Limited. Currently, the government of Kenya owns 50% of the company's equity, while the other 50% is held by Essar Energy Overseas Limited. In 2009, Essar acquired its share in the company from Shell, BP and Chevron (NYSE:CVX) (San Ramon, California).

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