Angola: Gemcorp, Africa Finance Corporation, and Afreximbank to Finance US$335 Cabinda Oil Refinery

Gemcorp Holdings Limited (GHL), Africa Finance Corporation (AFC), and African Export-Import Bank (Afreximbank) are delighted to announce that the Cabinda Oil Refinery in Angola has reached financial close. The project is financed by US$138 million of equity already provided by the project sponsors and a US$335 million project financing facility administered by AFC, Afreximbank, and a consortium of international and local financial institutions. GHL is developing the initiative in collaboration with Sonangol, the national oil company of Angola.

The credit facility covers the first phase of the project and paves the way for construction, enabling the daily processing of 30,000 barrels of crude oil. Eventually, the second segment will add an additional 30,000 barrels per day, bringing the refinery’s capacity to 60,000 barrels per day upon completion.

The refinery is anticipated to supply 10% of the nation’s total demand for refined oil products upon completion of the first phase, increasing to 20% upon completion of phase 2 while creating over 1300 direct and indirect employment. To date, 300,000 man-hours of training have been concluded for the upskilling of local employees, and one million man-hours have been worked injury-free on the project.

The Industrial Development Corporation (IDC) of South Africa, the Arab Bank for Economic Development in Africa (BADEA), and the Banco de Fomento Angola (BFA) are among the additional financiers that contribute to the project financing facility.

This investment is vital to ensuring Angola’s energy security, creating local employment opportunities, and advancing the country’s technological prowess. It will also reduce the nation’s dependence on imports to satisfy its current energy requirements.

Atanas Bostandjiev, the chief executive officer of Gemcorp, stated, “We are ecstatic to make this investment in the Cabinda Oil Refinery. The initiative aims to make Angola energy independent while capitalising on the country’s natural resources for the good of the community and the economy as a whole. Working closely with the Sonangol team and our collaborators, Africa Finance Corporation and Afreximbank, who share our vision to deliver this monumental life-changing infrastructure, has afforded us tremendous access to local expertise.

Samaila Zubairu, president and chief executive officer of Africa Finance Corporation, stated, “We are delighted to announce the successful financial closure of this innovative refinery project. This initiative is in line with our vision to capture and retain value in the Angolan economy while reducing carbon emissions by eliminating two unnecessary voyages involved in exporting crude oil as raw materials and importing it back as refined product. Significant employment opportunities will be generated by Cabinda Refinery, which will contribute to the development of the qualified workforce of the future. It will conserve precious foreign currency and improve Angola’s balance of payments. It will generate secondary industries that rely on the refinery’s output, thereby bolstering the economy and fostering long-term economic expansion. We look forward to working with stakeholders to continue advancing the continent’s sustainable development.”

Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, stated, “Afreximbank is pleased to contribute to such an important initiative for Angola and the surrounding region. Our participation in arranging the $335 million financing, along with our partners at AFC and Gemcorp, enables the initiative and ensures that it will generate development benefits in Angola and throughout Africa. The establishment of a modular oil refinery in Cabinda will add significant value to Angola’s primary export product, while reducing greenhouse gas emissions by eliminating the need to transport crude and refined products to and from Africa. Afreximbank continues to be committed to playing a crucial role in fostering economic development on the continent. We look forward to increasing intra-African commerce by supplying Angola’s refined products to nearby markets.”