Chad refinery shuts down again amid 'dialogue of the deaf'

Chad’s 50,000-b/d Djarmaya refinery, 40 km north of the capital Ndjamena, has been shut down by government officials again due to a dispute over the price of oil with supplier China National Petroleum Corp. International (CNPCI).

“The secretary-general of the trade and industry ministry has closed the Djarmaya refinery,” Chad’s state media announced. The refinery is co-owned by the CNPCI 60% and Chad’s state-owned Societe des Hydrocarbures du Tchad (SHT) 40%.

A government source said the facility was closed due to a disagreement over the price of oil between the Chadian authorities and CNPCI, the second closure in less than 6 months for the same reason.

“There is a dialogue of the deaf between the government and the Chinese to the point where industrial units had begun to close down for lack of oil,” a government official told AFP.

Last September, the Societe de Raffinage de N’Djamena (SRN) said the refinery would not operate for 40 days, starting on Sept. 25, due to a disagreement over price.

The refinery agreed a retail price of 41¢/l. of refined petroleum with the government, but World Bank figures show that refined products are sold in the country at a retail price of around $1.31/l.

“This discrepancy caused the refinery to operate at a loss of $4.7 million by end-August,” said IHS Global Insight analyst Marne Beukes, who added that “the loss of operations at the refinery will inevitably result in fuel shortages in Chad, which will require costly imports.”

Noting that CNPCI has become a vital investor in the country and is developing the Mimosa and Ronier oil fields as well as investing heavily in developing Chad's downstream sector, Buekes said Chad can “ill-afford a breakdown in its relationship with this important investor.”

The Djarmaya refinery, started up in June 2011, is designed to process oil from wells in the southern Bongor region through a 311-km pipeline.

In 2009, China National Petroleum Corp. (CNPC) announced plans to start the first refinery in Chad in partnership with the country’s government by 2011 (OGJ Online, Aug. 27, 2009).

The parties signed a memorandum of understanding on Aug. 24 for the N'Djamena refinery to establish a joint venture, secure a loan, and apply for a preferential export buyers’ credit (OGJ Online, Aug 29, 2009).

According to OGJ, Chad has 1.5 billion bbl of reserves and produces 120,000 b/d of oil. Chad exported 36.7 million bbl of its oil from January to November 2011, according to a statement issued by Cameroon-based Pipeline Pilot Steering & Monitoring Committee (PSMC).

Chad transports its crude through the 1,080-km Chad-Cameroon Pipeline, which is operated by ExxonMobil Corp., Chevron Corp., and Malaysia's Petroliam Nasional Bhd.

The line extends from the southern Chad oil fields in Doba to Cameroon's southeastern Atlantic port of Kribi. About 80% of the pipeline runs through Cameroon, giving Cameroon rights to royalties and monitoring of the tunnel.

Contact Eric Watkins at hippalus@yahoo.com.

Related Articles

EPA approves Magellan’s Corpus Christi splitter project

12/12/2014 The US Environmental Protection Agency has issued a final greenhouse gas prevention of significant deterioration construction permit to Magellan Pr...

Keyera to take majority interest in Alberta gas plant

12/12/2014 Keyera Corp., Calgary, will pay $65 million (Can.) to buy a 70.79% ownership interest in the Ricinus deep-cut gas plant in west-central Alberta.

PBF Energy, PBF Logistics make management changes

12/12/2014 Matthew Lucey, currently executive vice-president of PBF Energy Inc., will succeed Michael Gayda as the company’s president. Todd O’Malley, current...

Repairs under way at ORPIC’s Muscat refinery

12/11/2014 Oman Oil Refineries & Petroleum Industries Co. (ORPIC) said it plans to resume operations at its 106,000-b/d Mina Al Fahal refinery near Muscat...

Qatar Shell lets EPCM contract for Pearl GTL operations

12/11/2014 Qatar Shell Ltd., a unit of Royal Dutch Shell PLC, has let a contract to a division of SNC-Lavalin Group Inc., Montreal, to provide long-term engin...

Phillips 66 advances plans for splitter at Sweeny refinery

12/11/2014 Phillips 66 has filed an application with state regulators for a permit to build a condensate splitter at its 247,000-b/d Sweeny refinery in Old Oc...

Chevron Phillips Chemical concludes Sweeny ethylene expansion

12/11/2014 Chevron Phillips Chemical Co. LP (CPCC) has completed installation of a furnace at its Sweeny petrochemical complex in Old Ocean, Tex., that will e...

Samref wraps Yanbu refinery revamp

12/11/2014 Saudi Aramco-Mobil Refinery Co. Ltd. (Samref), a 50-50 joint venture of Saudi Aramco and ExxonMobil Corp. subsidiary Mobil Yanbu Refining Co. Inc.,...

BPCL adds petrochemicals to Kochi refinery expansion

12/09/2014 Bharat Petroleum Corp. Ltd. (BPCL), Mumbai, plans to diversify into petrochemicals production as part of the ongoing integrated expansion and upgra...

White Papers

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Plant Design for Lean Construction - at your fingertips

One area which can provide improvements to the adoption of Lean principles is the application of mobil...
Sponsored by

How to Keep Your Mud System Vibrator Hose from Getting Hammered to Death

To prevent the vibrating hoses on your oilfield mud circulation systems from failing, you must examine...
Sponsored by

Duty of Care

Good corporate social responsibility means implementing effective workplace health and safety measures...
Sponsored by

Available Webcasts


On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.

register:WEBCAST


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.

register:WEBCAST


Utilizing Predictive Analytics to Optimize Productivity in Oil & Gas Operations

Tue, Nov 18, 2014

Join IBM on Tuesday, November 18 @ 1pm CST to explore how Predictive Analytics can help your organization maximize productivity, operational performance & associated processes to drive enterprise wide productivity and profitability.

register:WEBCAST


US HYDROCARBON EXPORTS Part 3 — LNG

Fri, Nov 14, 2014

US LNG Exports, the third in a trilogy of webcasts focusing on the broad topic of US Hydrocarbon Exports.

A discussion of the problems and potential for the export of US-produced liquefied natural gas.

These and other topics will be discussed, with the latest thoughts on U.S. LNG export policy.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected