Petrol refinery closures affect testing company

The move from a hybrid petrol-producing country to a petrol-importing country is increasingly becoming a challenge for South Africa, as many companies have been shut down or bought out, says testing and inspection provider Oleum Process & Pipeline (OPP) services sales project engineer Stuart Baigent.

“South Africa is pivoting from a production hybrid petrol-producing country to a petrol-importing country. The Engen refinery, in Durban, has closed and is not producing anything, only importing, which, in turn, affects us greatly, many big refineries are leaving the country, we see BP and Shell also closing their doors, this makes the future projects we had planned also being cancelled he says.

This comes after petroleum refineries BP and Shell owned by Sapref announced in March that they will halt operations indefinitely, as they mull the future of the refinery.

"The decision has been taken to allow for an informed finalisation of the various options available to the shareholders, with a sale option being the most preferred," the companies said in a joint statement released in March.

"Until decisions about the future of the plant have been made – including a possible change of ownership – the Sapref shareholders are unable to commit to further investment in the refinery," the statement said.

Baigent says the decision by Sapref to cease operations in South Africa “has had a dramatic impact” on OPP because the petrol producers were some of its biggest clients.

“BP and Shell are also no longer operating their expansions in Mozambique. The terrorist attacks in northern Mozambique have also resulted in the cancellation of big projects in the oil and gas industry in Southern Africa that has also affected us greatly.”

However, OPP plans to continue working in the south of Mozambique to recover from losing its biggest clients. The company has also been doing work in Zambia, Kenya and Tanzania.

Despite these challenges, the company offers the precommissioning of pipelines, and oil or gas installations, to decrease on-site personnel requirements, the duration of required activities and costs.

OPP provides inspection services using an intelligent pig survey that enables the operators responsible for the integrity of the pipeline to assess the failure risk, owing to metal-loss corrosion including internal geometry and distance.

The company also provides decommissioning services that assists companies in safely discarding their process plants and pipelines.

Locally, OPP is doing a routine furnace inspection in a coastal province. The company will inspect the tubes used to hold the oil that is heated in the furnace.

The company is also helping a large pipeline operator to abandon an old pipeline that was built in the 1960s.

It will also send a team to Mozambique to build a new pipeline and inspect the new pipeline for a large integrated energy and chemicals provider.