* African plants face tough competition from abroad
* SAR wins $350 mln credit line from Nigeria's UBA
* I. Coast and Senegal compete to supply West Africa
By Diadie Ba and Emma Farge
DAKAR, Feb 3 Senegal will keep its one, ageing
oil refinery in operation after the government completed a
strategic review to determine its future, industry sources
familiar with the matter said.
The study commissioned by the government considered closing
the 25,000 barrel per day SAR plant and converting it into an
import and storage terminal.
SAR, owned by state oil company Petrosen (46 percent), Total
(20 percent) and the Saudi Binladin Group (34
percent), has secured a loan of $350 million to finance 2014
crude imports, Phillips Oduoza, the chief executive of Nigerian
bank United Bank for Africa (UBA), told Reuters.
An official at SAR declined to respond to Reuters' requests
While demand for fuel in Africa is booming, refiners such as
SAR have been struggling to compete as shipments from foreign
refiners and traders have been flooding the $80 billion market.
The Senegal plant, more than 50 years old, is expensive to
run because there is no local source of crude oil, and most is
imported from Nigeria.
Even with the Senegal plant open, its capacity is sufficient
at best to supply less than half of Senegal's market of 1.8
million tonnes a year.
Meanwhile, its debt after rescheduling amounted to 31
billion CFA francs ($63.7 million) at the end of 2012, a SAR
The plant will close for major maintenance work in April,
sources said, temporarily boosting imports further.
But it will need to spend more for Senegal to avoid losing
ground to Ivory Coast as a regional supply hub, an industry
source said, adding that SAR needed to invest to expand storage
and pipelines to improve supplies to neighbouring, landlocked
"Senegal has effectively already lost the competition to the
Ivory Coast to become the main logistical hub for the
sub-region. They've just been too slow," he said.
Ivory Coast's SIR refinery is almost three times the size of
the SAR facility and has ramped up output over the past two
years after operating well below capacity during a decade of
political turmoil that ended in 2011.
The country has also already built a fuel pipeline from
coastal Abidjan to inland Yamoussoukro and plans to extend it to
Burkina Faso, which currently gets fuel by truck from Senegal.
Puma Energy, part owned by commodities trader Trafigura, and
Vivo Energy have invested in Senegal's fuel sector.
($1 = 486.4160 CFA francs)
(With additional reporting by Tim Cocks in Lagos; editing by