South Africa Needs $8 Billion to Revive State Refineries
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South Africa Needs $8 Billion to Revive State Refineries
- South African officials estimate that over $8 billion will be required to reactivate two state-owned refineries, a move aimed at enhancing energy security and reducing reliance on imported fuels.
- This initiative comes as South Africa's fuel refining capacity has significantly decreased over the past decade, falling from more than 720,000 barrels per day to approximately 250,000 barrels per day by September 2026.
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South Africa is facing an estimated cost of over $8 billion to bring two mothballed state-owned refineries back into operation. This effort is critical for the nation to bolster its energy security and decrease its dependence on imported fuels.
The country’s fuel refining capacity has seen a sharp decline over the last decade, dropping from more than 720,000 barrels per day to about 250,000 barrels per day by September 2026. This reduction has led to South Africa importing more than half of its petrol and diesel, a significant shift from its previous near self-sufficiency in liquid fuels. Major facilities like SAPREF, Enref, and PetroSA’s Mossel Bay plant have either closed or been converted into import terminals.
The South African Reserve Bank (SARB) highlighted in September 2026 that this reliance on imported refined products is more expensive than processing crude oil domestically, contributing tens of billions of rand to the import bill. The SARB estimated that the oil import bill between 2021 and 2024 could have been R76 billion lower if refined-product imports had been capped at 25%.
The Central Energy Fund (CEF), a state-owned company, is planning to rebuild the SAPREF refinery near Durban, which was idled after floods in 2022. The goal is to achieve a throughput of 400,000 barrels per day, with potential for an increase to 650,000 barrels per day, subject to investments and approvals. As of September 2026, South Africa has two operational crude oil refineries: the Astron Energy Refinery in Cape Town and the Natref Refinery in Sasolburg, with a combined capacity of 208,000 barrels per day.