South Africa’s Refining Capacity Struggles
South Africa is facing a significant challenge with its refining capacity, as roughly 49% of the country’s capacity remains idle. Over the past five years, South Africa has seen a drastic reduction in its refining capacity, primarily due to accidents and underinvestment.
As a result, the country now heavily relies on imports to meet over 60% of its fuel demand, according to Transnet SOC Ltd., the state-owned logistics firm. In the first quarter of 2025 alone, South Africa imported 4.2 million tons of refined petroleum products, a trend that is projected to continue throughout the year, with imports expected to reach around 15.5 million tons.
The closure of several main refineries in South Africa has exacerbated the situation. Sapref, the country’s largest refinery owned by the Central Energy Fund (CEF), is currently shut, taking 180,000 barrels per day out of production. Engen’s plant, which produces 120,000 barrels daily and is now owned by Vitol, is also not operational.
Additionally, Sasol’s Natref facility, with a daily output of 108,000 barrels, is down due to an outage. PetroSA’s gas-to-liquid plant, another significant player in the industry, has also ceased operations, further reducing the country’s refining capacity.
Currently, only two refineries remain operational in South Africa: Sasol’s Secunda plant, which produces 150,000 barrels per day from coal and gas, and Glencore’s Astron refinery, contributing 100,000 barrels per day. However, these two refineries combined account for less than half of the country’s former refining capacity.
In an effort to address the situation, the South African government acquired the shuttered Sapref facility from Shell Plc and BP Plc last year. With domestic production constrained, the country is increasingly turning to global fuel traders to meet its demand. Swiss commodities giant Gunvor was recently shortlisted to acquire Shell’s retail fuel network in South Africa, highlighting the country’s reliance on external sources to fulfill its fuel needs.
The challenges facing South Africa’s refining capacity underscore the importance of investing in and maintaining infrastructure to ensure energy security and economic stability. The country will need to address these issues to reduce its dependence on imports and rebuild its domestic refining capabilities.
