Bitumen production at Natref's 107,000 b/d Sasolburg refinery in South Africa will cease from September, ending all the country's output of the heavy oil product.
Several South African bitumen market participants, including buyers from the refinery and suppliers of imported bitumen into the domestic and regional southern African markets, said officials from majority Natref shareholder Sasol had been informing customers of the planned move over the past week.
Customers were told that final bitumen supply from stocks held at the refinery would be supplied to them into October, with all supplies ending thereafter.
Market participants said the Natref plan is linked to a wider move of switching to sweeter crudes aimed at maximising output of light and middle distillates, which would also hit output of heavy products other than bitumen, notably high-sulphur fuel oil (HSFO).
Officials at Sasol, which owns 63.3pc of Natref alongside UK energy firm Prax with 36.4pc, have so far not responded to Argus' requests for comment. South African market participant said the move had been under consideration for some time, even before Prax agreed to buy TotalEnergies' Natref stake in December 2023.
South Africa turned from a major net exporter of bitumen, mainly to its southern African neighbours, to becoming increasingly dependent on imports after several of the country's refineries were either shut down or ended their bitumen production since 2020.
South African cargo imports in bitumen tankers surged to nearly 200,000t in 2024, according to Vortexa data, mostly into Durban and some into Cape Town.
Mediterranean supplies, mainly from Greece and Turkey, made up just over half of these, with Rubis and Continental supplying most. Mideast Gulf storage points, along with Bahraini state-owned Bapco's refinery and export terminal at Sitra, supplied around a third, while emerging exporter Pakistan shipped 8pc.
According to a South African bitumen supplier, the Natref refinery's bitumen production fell last year to 45,000-50,000t — from an Argus estimate of 140,000t in 2023 — because of numerous plant halts and interruptions. The market effect of Natref ending its bitumen output will therefore be limited, with another leading South African participant saying truck flows from the inland refinery had become increasingly unreliable.
The halt will nevertheless trigger more South African import requirements that are anyway likely to rise sharply in the coming years because of much-enhanced government infrastructure budgets.
The Natref refinery was forced to stop all production for about two months following a fire in early January this year.
French construction and bitumen supply firm Colas recently became the latest company to take a South African import asset position, agreeing a long-term deal with local firm FFS Refiners to operate four of five new bitumen tanks at an existing Durban facility once an FFS expansion there is completed, likely in the second half of this year.
