African refiners seek financial solutions, infrastructure upgrade

African Refiners & Distributors Association (ARA), has stressed the urgent need for countries on the continent to finance downstream projects, especially refineries, as part of measures to ensure cleaner air, and mitigate premature death.

With continuous importation of dirty fuels into the continent while refineries are yet to meet required standards, the World Health Organisation (WHO), said air pollution causes seven million premature deaths yearly, of which 600,000 are children.

ARA believes that shoring finance to upgrade oil refineries and associated storage and distribution infrastructure will check the numbers of premature deaths caused by air pollution in other developing world economies.

Being a leading discussion at the ongoing  ARA WEEK 2020 conference, Executive Secretary, Anibor Kragha, said Africa is not only in need of cleaner fuels, but also cleaner vehicles to achieve the cleaner air that would prevent the premature deaths that other developing economies around the world have experienced.

Kragha, a Nigerian, said: “To achieve that, we need to urgently attract the requisite financing needed to upgrade our refineries and complementary pipelines, depots and terminals, with rigorous analysis of the socio-economic and supply security benefits of each of these investments, which may often compete with each other.”

He noted that such an approach fails to understand the complexities of African fuel and energy supply chains, and could actually make the problem worse by delaying necessary investments to supply cleaner fuels across the continent.  

This is in reference to the contention by environmental lobbyists that Africa must leapfrog technology improvements to embrace alternative, less carbon-intensive solutions rather than invest in hydrocarbon fuels.

According to him, either with product imports or refinery investment, Africa needs both project and trade financing for improved port, and storage logistics to meet petroleum products shortfalls.  

He said Africa needs to embrace the improvement in vehicle maintenance, and controls required to assure that the clean fuels supplied deliver the desired objective of cleaner air.
He disclosed that ARA had prioritised a two-step path to the future: first, clean fuels; second, climate change mitigation policies.  

Kragha applauded the efforts of his predecessor, Joël Dervain, in laying out the policies needed by the downstream (supply, refining, storage, distribution and marketing) sector of the oil industry.

Ultimately, an economic, efficient, safe, secure and sustainable supply chain for clean fuels is essential to address public health concerns, avoid energy poverty and drive industrial expansion and trade across Africa.

“The key is to define ‘sustainable’, adding: “Only then can we secure the financing for the projects required to upgrade our refineries and infrastructure and deliver efficient supply chains for clean fuels to let Africa catch up with the rest of the world on the climate change agenda,” he said.