Saudi Arabia in talks to build an oil refinery in South Africa

[JOHANNESBURG] Saudi Arabia is in talks to build a crude-oil refinery in South Africa as part of a pledge last year to invest as much as US$10 billion in Africa's most developed economy.

The next steps will be joint studies conducted by Saudi Aramco and South Africa's Central Energy Fund, energy ministers from the two countries told reporters in Pretoria on Friday. South Africa's Jeff Radebe and Saudi Arabian Energy Minister Khalid Al-Falih signed a declaration of intent to cooperate in the field of oil and gas.

Saudi Arabia made the investment pledge in July last year, as South African President Cyril Ramaphosa seeks to revive a flagging economy with a drive to lure US$100 billion in investment in five years.

The recent discussions between officials from the two countries also included the possibility of Saudi Aramco using oil storage tanks in Saldanha Bay and a proposed petrochemical chemical plant, the ministers said.

"There are many priorities right now, but our major priority right now is the issue of the refinery," said Mr Radebe.

BLOOMBERG