Oil & gas major BP (NYSE:BP) is planning investments of nearly R5 billion (US $539 million) in South Africa and Mozambique over the next 5 years, said group managing director Iain Conn in a statement to the press Tuesday.
Addressing reporters in Johannesburg, Conn said that approximately R2.5 billion, or nearly half of the investment, would go towards upgrading the Sapref refinery in Durban. A joint venture with Shell, modernization of the Sapref facility will be aimed at complying with South Africa's proposed clean fuels requirements.
R1 billion of the investment has been earmarked for the building and upgrading of fuel terminals in both South Africa and Mozambique with the balance of funds going to expansion of BP’s retail network. In that vein BP then disclosed a new partnership with South Africa’s Pick 'n Pay for the opening of 120 new express retail stores at fuel stations.
Conn said the plans demonstrated a growing confidence in South Africa as an attractive region for investment, noting the announced ventures represented nearly five percent of BP’s total capital share for its global marketing, refining, and chemical business.
“The investments we are making in South Africa are not only a sign of confidence in the policy direction the country is taking, but they are also our commitment to all South Africans through the successful development of the energy infrastructure, market and associated skills and opportunities,” Conn said in his closing comments.
Nelisiwe Magubane, South African director general for the energy department, said the government supported and welcomed the investment.
In the African upstream market BP is also pursuing opportunities in Angola, Algeria, Namibia, Libya and Egypt.