Benin is stepping up plans to set up an oil refinery. It has reportedly established a partnership, with responsibility for evaluating the requirements and viability of the project.

On Wednesday, the 3rd of June, a report from the meeting of the Council of Ministers in the country suggested that the country had plans to acquire an oil refinery. The government has tasked a firm to carry out the necessary feasibility studies. The firm is to look into the economic feasibility of the infrastructure, and the market prospects for the year 2030, among other things.

An excerpt from the report read: “The project to build a refinery in Benin as part of a public-private partnership arises from the will of the State, to ensure better satisfaction of our country’s domestic consumption of petroleum products and to contribute to the refuelling of those in the sub-region.”

Although Benin is not an oil-producing country, it could import crude from Nigeria, a neighbouring oil-producing country, for processing in its refinery. If the intended project is successful,  Benin Republic would have enough fuel for itself and be able to export to neighbouring countries in the West-African region.

Nigeria, for example, is the biggest oil producer on the continent, but only refines about 10% of its crude. The proposed refinery in Benin will be a cheaper and closer option for Nigeria and it may become one of the biggest buyers of the Benin refined petrol.

Benin used to be an exporter of oil before loans to the country from international development agencies were frozen because the Swiss-based US Company, Pan Ocean Oil (Panoco), which was given the oil production contract, could not meet satisfactory financial and capability standards, and forced the country to take over the production for domestic use. Oil production in the country began in October 1986 in the Sémé offshore oil field, a field which yielded 1.35 million barrels of oil in 1991. In 1990, Benin exported about 1.27 million barrels of crude oil. However, it stopped oil production from its Sémé oilfield in 1998.

There have been many unsuccessful attempts to revive the country’s oil production over the years. In 2006, Kosmos Energy LLC explored for petroleum. Last year, Niger Republic and Benin also launched the construction of a Niger-Benin Oil pipeline, which is projected to take about two years.