Located at the entrance of the Suez Canal and near the city of Suez, the Suez Refinery has a capacity of three million tonnes annually or 68,000 barrels of oil per day (BOPD).

EBRD said that its funding is expected to help in modernizing the refinery with technical updates, which will boost its operational performance.

EBRD natural resources director Eric Rasmussen said: “We are very pleased to support Egypt’s strong drive towards the renewal and overhaul of its energy sector. The modernisation of the downstream segment plays an important role in this effort.

“The project we are signing today represents a major step forward and it also demonstrates the EBRD’s commitment to support Egypt and its sustainable and successful development.”

The modernization project of the refinery will particularly focus on installing a new vapour recovery unit (VRU) and refurbishment of the old coker unit along with various energy efficiency investments.

The investments will also be utilized to improve the flexibility of the refinery’s crude intake, thereby enabling production of higher quality fuels and lower sulphur fuels.

According to the EBRD, the modernization project will look to alleviate some of the refinery’s inefficiencies. The project will eventually help the Suez Refinery to produce middle distillates in compliance with Euro 4/5 specifications, which otherwise have historically been imported.

The extensive energy efficiency program to be implemented at the Suez Refinery will see it cut down more than 295,000 tonnes of carbon dioxide equivalent (CO2e) annually while generating annual savings of 300,000MWh of energy and 384,000m3 of water.

Egyptian Petroleum and Mineral Resources Minister Tarek El Molla said: “The project will contribute to one of the country’s main priorities in the ongoing oil and gas sector reform effort which is to optimise downstream performance and energy efficiency.

“The EBRD will also provide technical assistance, in addition to the US$200 million loan, which will support the sector-wide modernisation and reform programme which aims at reducing the fiscal deficit, attracting private sector capital and establishing a role model for improving public sector governance in Egypt.”