By: Ecofin Agency

Niger plans to build a new oil refinery with a processing capacity of 100,000 barrels per day. The government signed an agreement on Saturday, Aug. 15, with Canadian group Zimar Inc. to build the facility and an associated petrochemical complex, representing an estimated total investment of $1.9 billion.

“The agreement will run for 16 years, including three years for construction and 13 years for operations,” Niger’s Foreign Minister Bakary Yaou Sangaré said, adding that the project will be located in Dosso, a city in the southwest of the country.

The project will be developed under a public-private partnership, or PPP, using a build-operate-transfer (BOT) model. Zimar will finance and develop the energy infrastructure, operate it for the agreed period and then transfer ownership to the Nigerien state.

The Canadian group, which specializes in engineering, investment planning and the execution of industrial projects in the hydrocarbons sector, has four months to secure financing and complete the detailed engineering design. Financial close is expected within 12 months of the agreement’s signing, Sangaré said.

The agreement comes nearly two years after the parties signed a memorandum of understanding for the project in October 2024. Niger subsequently ordered a review of the initial plans, leading to revisions to some of the refinery’s specifications before the final agreement was concluded. The project was also redesigned as a conventional refinery, replacing the modular configuration originally envisaged.

Reducing dependence on imported refined products

Niger has produced oil since the early 2010s and began exporting crude in January 2024, mainly to China. The country is seeking to develop oil reserves estimated by the authorities at about 853 million barrels, while the Kafra basin is believed to hold potential resources of 2.7 billion barrels.

“The signing of the agreement [...] reflects Niger’s determination to diversify its partners, process more of its resources domestically, strengthen its industrial capacity, add value and open up new economic opportunities for our country,” Sangaré said.

Niger currently has one oil refinery, located in the southern region of Zinder. Société de Raffinage de Zinder (SORAZ), has been operating since January 2012 and has a processing capacity of 20,000 barrels per day. At the same time, the sharp decline in smuggled fuel from Nigeria following Abuja’s decision to end fuel subsidies, combined with Niger’s limited refining capacity, has led to recurring shortages, particularly of gasoline and diesel.

Domestic consumption has also risen following fuel-price cuts introduced by the government in recent years. The resulting pressure on refined-fuel supplies has increased the urgency of building a second refinery. The future Dosso facility could also supply neighboring countries.

“This refinery will end Niger’s dependence on supplies from abroad. Once it begins operations, the fuels that power Niger’s trucks, tractors and generators will be Nigerien products, refined on Nigerien soil, from Nigerien crude, by Nigeriens,” Zimar Chief Executive Benjamin Day Marc said, according to Niger’s official news agency ANP.