KZN govt reaches out to Engen amid its oil refinery considerations

9th October 2020 By: Marleny Arnoldi - Creamer Media Online Writer

KwaZulu-Natal Economic Development, Tourism and Environmental Affairs MEC Nomusa Dube-Ncube has tasked the Trade & Investment Council KwaZulu-Natal (TIKZN) to look into the matter of Engen Oil Refinery potentially closing its doors in a few years’ time.

Engen confirms in a statement that it is considering several options related to the refinery and says no decision has been made yet to close the refinery.

The petrochemicals company has, in the meantime, initiated consultations with employees about increasing its import and supply capacity in Durban and says it may convert the refinery into a fuel storage facility for imported products.

The company says it remains confident about the long-term growth prospects of South Africa and will consult with stakeholders at the appropriate time should any decisions of these matters be taken.

“As a leading company in the downstream South African petroleum market, we constantly review and evaluate efficiency improvements in our supply infrastructure to ensure that its business capabilities are strengthened, operations remain safe, security of supply is protected and risk is managed accordingly.”

Dube-Ncube cited a report published in the Mercury that the refinery might be closing down in 2023.

The trade and inward investment promotion agency TIKZN is mandated to support businesses in avoiding job losses and protecting production capabilities.

Dube-Ncube says the ports of Durban and Richards Bay handle more than 60% of the country’s seaborne cargo and government remains committed to working with companies such as Engen to increase its participation in the oil and gas sector.

The oil and gas industry in South Africa employs about 7 500 people and 90 000 indirectly through distribution and marketing, and has a yearly turnover of almost R200-billion, with the refining segment of the industry contributing almost 99% of the total industry turnover.