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Project Mthombo and the Eastern Cape’s industrial future

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Breakfast on 18 September will fuel top Eastern Cape business and government leaders who will meet to discuss the opportunities presented by the proposed oil refinery at the Coega Industrial Development Zone (IDZ), known as Project Mthombo.

Department of Economic Development, Environmental Affairs and Tourism MEC Mcebisi Jonas will address the gathering.

Project Mthombo is PetroSA’s propposed $10-billion, 360 000 barrel a day oil refinery. On completion Project Mthombo will be the biggest crude oil refinery in Africa and will secure the country’s future fuel requirements. It is estimated that 27 500 direct and indirect jobs will be created at the height of the construction phase and 18 000 direct and indirect jobs through its operation.

Leaders will gain insight into the significant opportunities for the region in terms of its potential for wide-ranging socio-economic impact in general and also linked with its varied up and downstream opportunities.

“Project Mthombo has catalytic potential that will lead the Eastern Cape into its industrial future,” said Ayanda Vilakazi, Coega Development Corporation (CDC) head of marketing and communications. “It will likely generate 5.5% economic growth for the province and open up opportunity for the development of a petro-chemicals cluster.

“Such a cluster, and the by-product industries that come with it, will spawn a host of new small and medium industries with jobs, economic growth, export and import replacement opportunities.”

A high-level lobbying team, led by Professor Derrick Swartz, Vice-Chancellor of the Nelson Mandela Metropolitan University, together with representatives from Coega, Nafcoc, the Black Management Forum, Transnet, and the Municipality’s Economic Development Directorate, are engaging various players in the political realm and national government, up to the Deputy President.

“PetroSA envisages the refinery coming on stream in 2019, and there is much to be done to ensure this happens,” said Kevin Hustler, Nelson Mandela Bay Business Chamber chief executive. “Coordinated efforts are needed from the city’s business community, local government and the education and training sector to ensure the Bay is ready to host this mega-project. This high-level breakfast is a crucial part of growing coordination and lobbying for Project Mthombo to come to its rightful home.”

The Chamber’s firm support for Project Mthombo recognises its role in securing South Africa’s liquid fuel supply, as well as delivering fuels that meet higher environmental standards than currently possible from local refineries.

In the Eastern Cape, and particularly in Nelson Mandela Bay, the project will bring significant benefits in job creation, long-term poverty relief and industrial diversification, through its construction and operation, as well as upstream opportunities in areas such as agro-processing and logistics, and downstream through the development of a petrochemicals industry.

“The Eastern Cape’s role players across business, government and civil society need to speak with a strong, unified voice to secure the project for the province. The support and united vision of the diverse stakeholders who have come together under the Chamber’s lead is going a long way to achieving the required level and volume of influence,” added Hustler.

Currently Project Mthombo is undergoing a Joint Study by PetroSA and Sinopec, the Chinese State Owned Energy Company, which will prepare the final business case for Mthombo in order to prepare for the Front-end Engineering and Design or FEED stage. The study will finalise the refinery capacity, configuration and costing. Sinopec has also expressed interest in being an equity partner.

“Project Mthombo is about development – but it is also about energy efficiency and freedom, sustainable job creation and industrial diversification. A project like this will change everything,” added Vilakazi.

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Alan Straton

Chief Cook, Bottle Washer and Broom Mechanic at MyPE
Passionate about Port Elizabeth and definitely NOT packing for Perth. Alan's ethos is epitomised in the words of Nelson Mandela; "I have fought against white domination and I have fought against black domination. I have cherished the idea of a democratic and free society. If need be, it is an ideal for which I am prepared to die." See more articles by Alan.