Russia's VEB signs deal to build two billion euro refinery in Morocco: report

FILE PHOTO: The logo of Russia's state development bank Vnesheconombank (VEB) is on display at the St. Petersburg International Economic Forum (SPIEF), Russia June 7, 2019. REUTERS/Maxim Shemetov

RABAT (Reuters) - Russian state development bank VEB signed a deal on Wednesday to build a 2 billion euro ($2.2 billion) oil refinery in Morocco, the north African country’s state news agency MAP said.

The deal was agreed alongside a Russia-Africa summit taking place in Sochi, Russia, as Russia seeks to increase its influence in the region.

The refinery, to be located in northern Morocco, will have an initial refining capacity of 100,000 barrels per day (bpd), with an eventual target of 200,000 bpd, MAP said, citing a statement from Morocco’s recently-formed MYA Energy, which signed the deal with VEB.

Morocco’s sole refinery, Samir, has been shut down since 2015 over unpaid taxes and heavy debt, leaving the country reliant on imported refined products.

Unlike its North African neighbours, Morocco imports most of its energy needs. The energy import bill surged to 82.3 billion dirhams ($8.6 billion) in 2018, up 18 percent compared to a year earlier.

Reporting by Ahmed Eljechtimi, Editing by Rosalba O’Brien