The CEO of Gemcorp Holdings Limited, the main shareholder in Angola’s Cabinda oil refinery, stated that the refinery will begin production by April 2025, as the first phase wraps up slightly ahead of schedule despite going over budget.
The refinery will be commissioned in January-February, with its first supplies of fuels reaching the local market in March April, Atanas Bostandjiev, founder and chief executive of Gemcorp, said on the sidelines of the Financial Times Africa Summit. The company owns 90% of the refinery.
The new project, which will be Angola’s second oil refinery, will help make sub-Saharan Africa’s No. 2 oil producer less reliant on costly fuel imports, especially as Angola aims to eliminate fuel subsidies. Investment for the first phase reached about US$500 million – US$550 million, Bostandjiev said, higher than the initial US$473-million estimate, as costs rose due to the Covid-19 pandemic and inflation.
Bostandjiev stated that the initial target for completing the first phase was July 2025. The greenfield project, partially owned by Sonangol with a 10% stake, will refine Angolan Cabinda crude supplied by Sonangol at a rate of 30,000 barrels per day, meeting 5-10% of Angola’s fuel needs.
A second phase will take crude processing capacity up to 60,000 bpd and bring a diesel and jet fuel-producing hydrocracking unit online, some 1-1/2 to two years after the refinery starts up. “Angola currently exports 98% of its crude and imports almost 100% of its refined products from Europe, so imagine how inefficient this whole system is,” Bostandjiev said. China is the biggest buyer of Angolan crude, accounting for nearly 60% of 2023 exports, according to Kpler data.
Once on stream, the refinery will initially export fuel oil and naphtha which cannot be processed locally, while supplying the local market with diesel and jet fuel, Bostandjiev said. Funding for the second phase has not been finalised yet, Bostandjiev said, adding that a final decision is expected in April or May once the plant is online.
Bostandjiev noted that in later phases, the refinery might export fuel to the Democratic Republic of the Congo. He explained that Gemcorp, a London-based investment firm focused on emerging markets, was the refinery’s only Western investor, attributing this to ESG frameworks that deter many Western institutions from oil and gas investments.
