Saudi Arabia in talks to build refinery, petrochemicals plant in South Africa

Saudi Arabia’s Energy Minister Khalid Al-Falih speaks during a news conference in Riyadh, Saudi Arabia January 9, 2019. (File Photo/Reuters)
Updated 18 January 2019

Saudi Arabia in talks to build refinery, petrochemicals plant in South Africa

  • Saudi Arabia is in talks to build an oil refinery and a petrochemicals plant in South Africa as part of $10 billion of investments in the country
  • Saudi oil would be used in the planned refinery whose construction would be led by Saudi Aramco

PRETORIA: Saudi Arabia plans to build an oil refinery and petrochemicals plant in South Africa as part of $10 billion of investments in the country, Saudi Energy Minister Khalid Al-Falih said on Friday after talks with his South African counterpart.
The announcement is a much-needed vote of confidence in Africa’s most industrialized economy, where President Cyril Ramaphosa is trying to attract $100 billion of new investments to rekindle growth.
The new refinery would reduce the need for refined product imports and cement Saudi Arabia’s dominant position in South Africa’s oil sector. The Kingdom already supplies 40 percent of the crude oil consumed in South Africa.
“Saudi Aramco and South Africa’s Central Energy Fund are moving forward with the feasibility study and identifying the parameters of the project,” Falih told reporters in Pretoria, South Africa’s administrative capital.
South African Energy Minister Jeff Radebe said a location for the refinery and petrochemicals plant would be finalized in the coming weeks. The capacity for the refinery is yet to be determined.
South Africa has talked about building an extra refinery for a decade, but it has struggled to agree commercial terms with investors.
It has six refineries, four using crude oil and two synthetic fuel as feedstock. Royal Dutch Shell, BP , Total and Sasol are among major refinery operators.
Al-Falih said Saudi Arabia had held discussions with Ramaphosa’s predecessor, Jacob Zuma, about building a refinery in South Africa but the proposed location was not attractive.
The two governments are now considering Richard’s Bay in KwaZulu-Natal province, home to South Africa’s major coal export terminal, among potential locations for the refinery.
State oil giant Saudi Aramco is also studying whether to use South African oil storage facilities in Saldanha Bay, while Saudi power firm Acwa Power is looking at investing in South Africa’s revamped renewable energy program.
Al-Falih confirmed there were discussions about the kingdom investing in South African state defense company Denel, as exclusively reported by Reuters in November.


Britain’s grocery sales lack festive spirit

Updated 10 December 2019

Britain’s grocery sales lack festive spirit

  • Sales of popular Christmas food purchases are down compared with last year

LONDON: Sales growth at Britain’s supermarkets slowed in the last quarter, industry data showed on Tuesday, as shoppers delayed their festive season preparations ahead of a national election on Dec. 12. 

Market researcher Kantar said all of Britain’s big four supermarket groups — market leader Tesco, Sainsbury’s , Asda and Morrisons — recorded sales declines over the period and lost market share to the German-owned discounters Aldi and Lidl which are aggressively opening new stores. Kantar said total British grocery sales rose 0.5 percent year-on-year in the 12 weeks to Dec. 1, having increased 1 percent in its November data set. 

“We’re yet to see consumers ramp up their spending in the run up to Christmas and, as anticipated, Black Friday only brought a limited boost for the grocers,” said Fraser McKevitt, head of retail and consumer insight at Kantar. 

“With the general election now only days away, people are waiting to fill their cupboards for the festive break,” he said, noting, for example, that sales of Christmas puddings and seasonal biscuits are down 16 percent and 12 percent in the past four weeks, compared with this time last year. Kantar said sales at Tesco fell 0.8 percent over the period, while Sainsbury’s, Asda, and Morrisons saw sales declines of 1.1 percent, 1.9 percent and 2.9 percent respectively. 

In contrast Aldi’s sales were up 6.2 percent and Lidl’s rose 9.3 percent, giving a combined market share of 14.1 percent. 

“While the big four all lost share in the past 12 weeks, 98 percent of the British public still visited at least one of their stores during the past three months,” said McKevitt. “Based on previous years, we expect them to increase their proportion of sales in the coming weeks as shoppers turn to familiar favourites and the traditional retailers in December.” 

Kantar said it was too early to say if Tesco’s new “Clubcard Plus” loyalty subscription scheme, launched last month, has had an impact on sales. Shares in Britain’s big supermarket chain were all down in early trade in London.