Johannesburg - South Africa issued a request for proposals to design, finance, build and operate a liquid bulk terminal to handle petroleum products at the country’s biggest port as a shortage of refining capacity is expected to spur growth in imports.
Bidders must be at least 51 percent owned by black citizens to qualify to participate in the 25-year concession at the Durban port, Transnet, the state-owned rail and ports operator, said in a document posted on the National Treasury’s website. Bids need to be submitted by January 27.
South Africa's economy plans to build fuel terminals as demand for storage in Africa grows. Chevron, which is selling South African assets, had objected to plans for more storage facilities to hold fuel imports. The country is also working toward being able to handle cleaner fuels that have lower sulphur content.
Estimates on the cost of upgrading terminals to work with the new specifications range from $2.7 billion (R38.6bn) to $7bn and it is unclear how this will be paid.
“Based on the current growing demand for liquid fuels and the lack of investment in refining or alternative liquid-fuel manufacturing capacity, South Africa and the region will remain short of products in the foreseeable future,” Transnet said in the document. It expects Durban’s fuel imports to grow to 34.5 billion litres in 2044 from 5.2 billion this year.
Puma Energy was planning a fuel depot in the port of Richards Bay as it expanded its operations, it said in February. It expects the 46-million-litre oil products terminal to be operational by the end of September. Burgan Cape Terminals, 70 percent owned by a Vitol Group-led venture VTTI, is building a fuel-storage facility in Cape Town, a venture Chevron initially opposed, due to be completed in early 2017.
BLOOMBERG