The new $10-billion (R 82,6 billion) oil refinery planned for Nelson Mandela Bay will be designed with shale gas in mind.
This was according to PetroSA’s Vice President for New Ventures Midstream, Jörn Falbe, who described the size of Project Mthombo as the equivalent of building 100 new soccer stadiums.
“Project Mthombo is what we refer to as a mega project; a project so big it will change the industry landscape and falls outside even the normal scope of the company doing the project,” he said.
Falbe said Project Mthombo was currently in phase one, which involves a joint study by PetroSA and Sinopec, the Chinese State Owned Energy Company, which will prepare the final business case for Mthombo by the end of 2012.
He said this included looking at the overall design of the refinery, where the technology would be sourced from, understanding the procurement sources and what would be possible with the current technology, as well as determine various non-negotiables and providing a better cost estimate for the project.
He said once this was done, they would move on to phase two, which was to prepare for the Front-end Engineering and Design or FEED stage, which would determine the refinery capacity, configuration and costing.
“From here we will be able to move into the Environmental Impact Assessment phase,” he said.
Falbe said the refinery would be designed to accommodate shale gas as a utility to power furnaces and other energy inputs, replacing initial supplies of naphtha, hydrocarbons and LPG gas which would be derived from crude oil imports and used to power the refinery.
“At the moment we do not know how much shale gas is available, but the long term view is that the refinery can be geared up to use shale gas as a utility source, thus freeing up the naphtha, hydrocarbons and LPG gas produced for feedstock for local secondary industries as well as export,” he said.
Falbe said this would then also strengthen the economic viability of shale gas exploration and extraction, as it would provide an anchor market that would create a demand for the product.