Engen, a South African based unit of Petronas, has announced that it has halted all crude imports from Iran, which used to account for 80 percent ofRead more +
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To comply with US and EU economic sanctions against Iran, Engen, a unit of Petroliam Nasional Bhd (Petronas), and South Africa’s largest importer of Iranian crude, has announced its suspension of all oil imports from the Persian state.
Engen operates the second biggest refinery in South Africa, processing 135,000 barrels a day, and normally buys 80 percent of its crude from Iran. A spokeswoman for the company, Tania Landsberg, said that contingency supplies have been put in place to cover the loss of Iranian crude. Although Shamsul Azhar Abbas, CEO of Petronas, said that whilst alternative supplies have been sought, none have, as of yet, been secured.
The cost to Engen for converting the refinery to handle a different type of oil is estimated to be around $39 million, said Nelisiwe Magubane, director general of the department of energy in South Africa.
The South African government will do all they can to ensure that the higher cost of other oil supplies over Iranian crude will not negatively affect the Engen refinery, or the regional economy in general.
The Natref refinery, which is run by Sasol Ltd. and Total SA, has also halted all imports of Iranian crude, which used to provide about 20 percent of supplies to the refinery.