Emerging markets asset manager, Gemcorp, has successfully secured a $335 million financing facility to support the construction of the Cabinda oil refinery in Angola.
The financing was mobilized in collaboration with two finance organizations, the African Finance Corporation (AFC) and the African Export-Import Bank (Afreximbank). With this financial backing, project partners Sonangol and Gemcorp have obtained the necessary capital to move forward with the development of the refinery.
The $335 million facility, combined with $138 million in equity provided by Gemcorp and Sonangol, will cover the expenses for the first phase of the refinery’s development. This initial phase includes the establishment of a crude distillation unit, desalinator, kerosene treating unit, and auxiliary infrastructure. Moreover, it involves the construction and installation of a conventional float anchoring system, pipelines, and a 1.2-million-barrel storage terminal. Construction for Phase 1 commenced back in 2020.
Gemcorp revealed that the credit facility will also enable the project partners to progress with Phase 2 of the development, which involves the addition of units for catalytic reforming, hydrotreating and catalytic cracking. These additions will transform the refinery into a full-conversion facility.
Upon completion of Phase 1, the refinery will have the capacity to process up to 30,000 barrels per day (bpd), fulfilling 10% of the country’s total demand for refined oil products. Phase 2, once completed, will double the processing capacity, catering to 20% of the demand. Gemcorp CEO Atanas Bostandjiev emphasized the significance of the project, stating, “The project stands to make Angola energy independent while leveraging its natural resources for the benefit of the community and wider economy.”
Afreximbank President and Chairman of the Board of Directors, Prof. Benedict Oramah, highlighted the refinery’s potential impact on Angola’s economy and environment, stating, “The establishment of a modular oil refinery in Cabinda will add critical value to Angola’s main commodity and its largest export product, while contributing to a reduction in greenhouse gases by reducing the need to transport crude and refined products to and from Africa.” Furthermore, the refinery is already proving to be a crucial economic contributor, with over 300,000 hours of training completed to upskill local employees.
AFC President and CEO, Samaila Zubairu, added, “Cabinda Refinery will generate significant employment opportunities, which will help build the skilled workforce of the future. It will save valuable foreign exchange and enhance Angola’s balance of payments. It will create spin-off industries that rely on the output of the refinery, thereby boosting the economy and driving long-term economic growth.”
