Zambia will float some shares of its 24,000 barrel-per-day Indeni oil refinery on the Lusaka bourse and seek another strategic equity partner after buying French oil giant Total’s 50 percent stake.
Energy minister Kenneth Konga said on Friday several local and foreign investors had already shown interest to take a stake in Indeni oil refinery, after the government paid Total $5.5 million for the 50 percent shares it was holding. Konga told journalists the cabinet would soon decide on a preferred strategic equity partner in the refinery, which is Zambia’s main source of fuel for the mining industry, the country’s economic lifeblood. “We have no intention of holding on to the whole 100 percent stake that we now own in Indeni. We will offload part of the share in the plant and cabinet will soon meet to decide which investor will buy the shares,” Konga said. He said floating shares on the Lusaka Stock Exchange (LuSE) would enable Zambians to partly own the refinery. Indeni Petroleum Refinery was 50 percent each jointly owned by Total El Fina EIF and the Zambian government and latest market estimates indicate the refinery needs $65 million in recapitalisation to rehabilitate equipment and machinery and improve its performance. The government on Wednesday said it had raised its shareholding in Indeni to 100 percent after concluding the talks with Total. Zambia has been experiencing acute fuel shortages in recent weeks, owing to the collapse of a key refinery component at the 36-year-old plant, which threaten to reverse the economic gains made by Africa’s largest copper producer. Konga said Indeni, which was initially due to resume output on Friday would do so over the weekend. “All the necessary repairs to the plant will be finished today but production will start over the weekend,” Konga said.
Total last year told Zambia of its intention to sell its shares to another company but authorities in the Southern African country objected and opted to fully own the refinery.