TRAFIGURA IN

AFRICA
2 Trafigura in Africa

Contents
Africa and commodities 3
Serving the African Copperbelt  4
Serving Africa’s oil producers and refiners 8
Puma Energy: a Trafigura investment in Africa 10
Case studies: Fuelling African energy demand 12
Developing new markets and assisting Africa’s energy transition 14

4.1% 13% 20%

Expected GDP growth up to 2023 1
Projected population growth Oil demand increase up to 20253
up to 20232

1
Between 2019 and 2023. Source: IMF 2018 World Economic Outlook
2
Between 2018 and 2023. Source: UN 2017 Revision of World Population Prospects
3
Source: IEA 2018 World Energy Outlook.
 Trafigura in Africa 3

Africa and commodities

Africa’s economic fortunes are closely linked to developments in commodity

markets. Many African countries are rich in natural resources such as oil and
gas, copper, cobalt and iron ore, and they earn substantial revenues from their
export. The continent’s growing cities and industries have an increasing appetite UN Sustainable
for imports of everything from gasoline, diesel, fuel oil and liquefied petroleum Development Goals (SDGs)
gas to advanced chemicals and construction materials. By fulfilling the commitments
One thing that producers and consumers of commodities share is the need for in our Corporate Responsibility
support in ensuring that these materials add value in the market and reach the Policy and Business Principles,
places where they’re needed. we contribute to decent work
These are the services offered in Africa by the Trafigura Group, one of the world’s and economic growth (SDG 8).
leading commodities trading and logistics firms. Trafigura sources, stores, By developing infrastructure
transports and delivers a range of raw materials including oil, refined petroleum and managing logistics routes,
products, non-ferrous metals and minerals to clients around the world. It invests we promote inclusive and
in industrial and financial assets that support this activity, including mines, sustainable industrialisation
warehouses, storage facilities, shipping and transport. (SDG 9). Through our efforts to
support responsible procurement
Founded in 1993, Trafigura has been active in Africa for more than 20 years.
of commodities, we encourage
Working with an unparalleled global network, the company helps African
sustainable production patterns
producers and refiners of oil, metals and minerals finance their operations,
(SDG 12). Our business partnerships
manage their exports and ultimately connect with their end customers
help mobilise resources for
around the world. We help the continent’s growing economies meet rising
development (SDG 17).
demand for fuel and other materials by providing quality products via cost-
effective and efficient supply chains. Trafigura contributes towards the
development of new markets for more environmentally friendly fuels, towards
new business partnerships providing power, and towards the growing use of
renewable energies.
All this requires a substantial and experienced presence on the ground. Trafigura
Group employs hundreds of people in key African commodity markets such as
the Copperbelt region. Multimodal logistics subsidiary Impala Terminals owns
and operates a network of warehouses and transport assets enabling the flow of
exports and imports along the most important logistical corridors connecting
this producing region with the coasts.
Trafigura’s commercial teams are in constant contact with African national oil
companies and refiners helping them to finance their activities, hedge against
market fluctuations and secure the best prices for their products around the
world. Partner company Puma Energy operates multiple fuel storage facilities
and retail distribution networks across the continent, as well as supplying the
energy needs of the mining industry. We operate in close partnership with
many governments in the region, helping them to secure security of supply in
sometimes challenging conditions. We make it our mission to trade responsibly
and apply the highest standards of governance, transparency and conduct.
This publication sets out in more detail how we go about these tasks, with
illustrations and examples from numerous markets across the continent.
It shows how, in Africa as elsewhere, Trafigura is growing prosperity by
advancing trade.
Jeremy Weir, Executive Chairman and Chief Executive Officer
4 Trafigura in Africa

Serving the African Copperbelt

Overview
The Copperbelt, stretching across central-southern Africa, is the We now transport some 900,000 metric tonnes per year of metal,
locus of the global non-ferrous metals business. Demand for copper, including copper, cobalt, zinc in concentrate and refined forms,
cobalt and other materials produced in the Democratic Republic from production centres such as Lubumbashi and Kolwezi by truck
of the Congo and Zambia is growing rapidly as urbanisation and and train along five separate export corridors to the east and
electrification continue to spread across the developing world. west coasts. Using a diversity of transport methods and routes
This growth is expected to accelerate further as decarbonisation increases service reliability and reduces bottlenecks. An exciting new
gathers pace and sales of electric vehicles rise – to the benefit of development is the reopening of the rail line from the DRC border
the many people in the region whose livelihoods depend on the to the Angolan port of Lobito, which promises to cut transport
resources industry, both in the formal and informal mining sectors. times and costs significantly from the fast-growing production
For example, two thirds of global production of cobalt – a vital region around Kolwezi. Overall volume is expected to continue
material for use in lithium-ion batteries that power electric vehicles to grow in the next few years, and we are investing to ensure that
– originates from the DRC. our infrastructure, including warehouse space and rail capacity,
keeps pace.
In the Copperbelt, digging metals out of the ground in raw form and
refining them is only part of the story. Another key task is getting And it’s not just about buying and transporting metal: we are also
them from mine to market – more particularly from land-locked big suppliers of essential fuels and other materials to the region’s
producing areas to the ocean and to consuming industries in other miners – bringing them in along the same road and rail corridors
continents. This is where Trafigura comes in. used for export.
Trafigura, one of the world’s leading traders of metals and minerals, In short, we are the Copperbelt’s indispensable partner, enabling the
has been serving the Copperbelt for more than 15 years. Our Group mining industry there to operate, generate revenues and create jobs
invests in infrastructure and logistical capabilities to move metal in the most efficient manner.
from where it’s produced to where it’s needed, managing every stage
of what is by definition a long and complex journey. We provide
financial support to producers by extending credit that is repaid with
product. We are the largest trading company in the region and the
only one to have maintained a constant physical presence in DRC
and Zambia, supported by unrivalled infrastructure, as production
has grown.

+15 years 900,000 mt

Activity in the Copperbelt Concentrates and metals
transported per year
 Trafigura in Africa 5

Mining Responsible sourcing

In addition to managing the logistics of supply from and to the Almost two-thirds of the world’s cobalt is supplied by mines in
DRC, Trafigura Group is also an investor and owner in the local the DRC. Between twenty to forty percent of the country’s cobalt
mining industry. Our Mawson West mine, north of Lake Mweru, is output is produced by the Artisanal and Small-Scale Mining (ASM)
outside the Copperbelt, employs about 800 people – 75 percent sector. Recognising the large numbers of workers employed in
of whom are from the immediate vicinity – in a region with few tough and often dangerous conditions in such informal mining,
other sources of wealth. In another demonstration of our Group’s Trafigura is engaged in an initiative to increase transparency and
logistical capabilities, we transport the mine’s 26,000 metric improve management of social and environmental impacts.
tonnes of annual copper production safely along fragile roads to In 2018, Trafigura signed a three-year cobalt hydroxide marketing
the lake port of Pweto and across the lake by barge to Zambia agreement with mining company Chemaf. Chemaf is developing
and ultimately foreign markets. a major copper-cobalt mining concession at Mutoshi where
local communities have historically engaged in unregulated
ASM activity. Rather than seeking to evict these workers,
Chemaf – with Trafigura’s support and that of an internationally
respected NGO – has set up a pilot project to improve practices
on site such that ASM can become formalised and ultimately
semi-mechanised.
Workers on site have enlisted in a formal co-operative authorised
by the DRC regulatory authorities. They are provided with
appropriate safety equipment, work in a regulated environment
and sell their product at a rate based on the international market
level. The project has already attracted considerable international

26,000 mt
interest as a demonstration of how it is possible to ameliorate
conditions in these challenging circumstances.
Copper production per year at Mawson West To learn more about this project and to read our discussion
document on responsible sourcing in the electric vehicle battery
supply chain visit:
www.trafigura.com/responsibility
6 Trafigura in Africa

DRC – Kolwezi

550,000m2
Land area

Impala Terminals
Impala Terminals is a Trafigura Group In Zambia and the DRC, bonded
6,000m2
Covered warehouse bulk/
company specialised in providing multi- warehousing facilities handle copper break-bulk
modal logistics solutions for imports, cathodes, blister and concentrates, together
exports and intra-regional supplies. In the with cobalt and zinc for customers in the
Copperbelt, the company has developed a main mining areas of Kolwezi, Lubumbashi
set of logistics corridors that offer customers and Zambia. These hubs are the collection
safe and secure handling of goods and points for all materials and are responsible
end-to-end solutions for imports as well for loading and onward despatch to trains.
as exports, giving producers optionality They have recently been developed to
with multiple African ports to choose from, receive inbound cargoes such as fuel,
including Durban, Dar es Salaam, Beira chemicals and mining equipment, offering
and Lobito. It is the only company in the more cost-effective, round-trip solutions for
region to offer rail transport to Africa’s east, importers and exporters.
west and south coasts, linking a network of As Group policy, Trafigura follows
strategically located warehouses at the ports international best practice and strictly
and at the Copperbelt sites of Lubumbashi complies with regional regulations. Angola – Lobito
and Kolwezi (DRC) and Ndola (Zambia). This means Impala takes extra care when Rail siding and container handling
Rail transport offers important advantages assembling each shipment, ensuring all the Rail and road connectivity
over trucking, including economies of scale, paperwork is in order, that vehicles are fit for
better security, tracking and tracing, and,
of course, less harm to the environment
purpose and properly loaded and secured.
It then monitors each truck’s or train’s
3,000m2
Land area
and less disturbance to local communities. progress to its final destination and provides
Impala’s rail network is the result of security, including for overnight stops while Lobito rail corridor
years of painstaking negotiation with goods are in transit. This is particularly In September 2018, in a historic first,
regional rail companies and regulators important to assure banks financing the Impala delivered an 800-tonne cargo
and significant investment in rolling stock shipments that their interests are being of copper blister from Kolwezi to the
and infrastructure. taken care of. Angolan border at Dilolo and then
Today, Impala employs up to 350 people in In 2019, Impala is on track to double both onward to the port of Lobito – the first
Africa including over 225 at the three inland export and import volumes to an overall consignment of copper to make the
Copperbelt sites. It has invested heavily total of 1 million tonnes. It is expanding its 1,800 kilometre journey to Angola’s
in training and equipment to ensure high warehouse facilities at a new ‘mega-site’ Atlantic coast in the 40 years since the
operating standards. near Lubumbashi to cope with an expected country’s civil war shut down the line.
further increase in volumes. It has been shipping increasing volumes
www.impalaterminals.com since. While the volume is still just a
tiny fraction of copper exports from the
region, the reopening of this centuries-
old trade route offers the potential for
miners in the rapidly expanding Kolwezi
region to export to American and
European markets much more quickly
and cheaply than available alternatives.
The journey from Luau on the Angolan
side of the border to Lobito takes
36 hours, compared with the 10 to 12
days required to make the trip from the
DRC to Durban.
 Trafigura in Africa 7

DRC – Lubumbashi site 1 DRC – Lubumbashi site 2 Tanzania – Dar Es Salaam

25,000m2 550,000m2 25,000m2

Land area Land area Leased land from the
Port Authority of Tanzania
2,500m2 6,000m2
Covered warehouse bulk/break-bulk Covered bonded warehouse 12,000m2
Covered warehouses

Zambia – Ndola
DAR ES SALAAM

LOBITO KOLWEZI
DRC
LUBUMBASHI
DAR ES SALAAM CORRIDOR
LUM-DAR: 2,039km
55,000m2
LOBITO CORRIDOR TANZANIA Land area

9,000m2
LOB-KOL: 1,775km
MOZAMBIQUE
NDOLA Covered bonded warehouse

ANGOLA ZAMBIA

NAMIBIA

BEIRA
BEIRA CORRIDOR
LUM-BEA: 1,587km

WALVIS BAY
WALVIS BAY CORRIDOR
LUM-WLV: 2,472km JOHANNESBURG

DURBAN
DURBAN CORRIDOR
SOUTH AFRICA LUM-DUR: 2,127km

KEY
Mozambique – Beira
Impala Terminals locations
Rail and road 6,000m2
Road Covered warehouses bulk/break-bulk

South Africa – Johannesburg,

Durban

60,000m2
Namibia – Walvis Bay Covered warehouses bulk/break-bulk

5,000m2 4,000m2
Covered warehouse External yard
8 Trafigura in Africa

Serving Africa’s oil producers and refiners

Africa is one of the world's key crude oil producing regions. Structured Trade Finance
As a leading crude and refined products trading company, Credit is an important element of Trafigura’s service offering both
Trafigura makes it a priority to maintain close relationships with to oil producers and refiners, in the form of prepayments or pre-
important producers and refiners on the continent and with their export finance arrangements that are amortised by off-take of
host governments worldwide. crude or refined products, generally over a period of up to five years.
Our approach is unique. Our commercial teams spend a lot of time These arrangements have become increasingly important in Africa
in the various countries, in order to develop in-depth understanding as large international banks have retreated from lending to emerging
of their needs in terms of supply, off-take, price-hedging, logistics market clients in order to focus on domestic markets.
and credit. We then work collaboratively to determine how best to Traditionally these banks used to arrange prepayment credits to
put the entire portfolio of Trafigura capabilities at the service of the resource producers and refiners and then bring in trading firms to
customer in order to add value to their business. absorb the subsequent commodity offtake. Now fewer banks offer
At the simpler end of the spectrum, we aim to make competitive such facilities, but emerging market producers still need credit,
bids in national supply or off-take tenders. In this we are assisted by especially when their finances come under strain as commodity
our broad regional footprint, our strategy of taking a holistic view of prices dip. In recent years Trafigura has increasingly offered so-
the requirements of multiple countries in sub-regions such as West called Structured Trade Finance packages to producers and refiners,
or East Africa, and our partnership with fuel storage and distribution syndicating the risk to financial institutions.
company Puma Energy, which creates economies of scope and scale. A typical arrangement with a crude producer involves an advance
More complex and deeper relationships include multi-year off- amounting to 50 to 90 percent of the estimated value of exports,
take or supply agreements involving pre-payments amortised by depending on the tenor of the financial arrangement. It gives
commodity deliveries; swap arrangements in which crude off- access to credit that may not be otherwise available to producers
take is offset by deliveries of refined products; and co-operation in certain markets, and in a flexible form. Contracts include built-
involving local infrastructure investment by Trafigura Group or in arrangements to vary delivery volumes as prices fluctuate.
affiliate companies. In the event of major and sustained market movements, it can be
Various examples are set out on the opposite page. But the necessary to restructure a prepayment arrangement as occurred
overarching message is that Trafigura always goes the extra mile recently in the case of the Republic of the Congo’s national oil
to deliver unique, bespoke service packages designed to meet the company SNPC.
customer’s needs.

75.5 m barrels 126.2 m barrels

Total oil and petroleum products Total oil and petroleum products
purchased in 2018 in Africa sold in 2018 in Africa
 Trafigura in Africa 9

TIONAL PE
NA

TR
NIGERIAN

OLEUM
OR
N
C

P O R AT I O

Nigeria Ivory Coast Republic of the Congo

Nigeria, as the continent’s largest This has long been an important market (Congo Brazzaville)
economy with rapidly growing needs for for Trafigura, and we have strong The national oil company Société
fuel, power and infrastructure, is a top relationships both with the refining Nationale des Pétroles du Congo (SNPC)
priority for Trafigura. We are a leading company Société Ivoirienne de Raffinage has been a major provider of crude
participant in the Nigerian National (SIR) and the national oil company off-take to Trafigura over the years and
Petroleum Corporation’s (NNPC) crude- Petroci. We have backed prepayments a recipient of more than USD1 billion
for-gasoline swap programme, which to SIR for refined products of more than in prepayment credit. Following the
supplies the lion’s share of Nigeria’s USD300 million, which helped finance fall in oil prices from 2014, we entered
gasoline imports. In the 2017 calendar an upgrade of the refinery and improve into debt restructuring negotiations
year, this generated offtake of 1.8 million operational cash flows. We also backed with SNPC which resulted in a debt
barrels of crude oil, in exchange for pre-export facilities for crude to Petroci rescheduling agreement that will be
delivery of 1.8 million barrels of gasoline. amounting to circa USD160 million. signed late 2019. The process underlined
We are also important off-takers of the strength of our partnership.
Nigerian condensate, liquefied natural
gas (LNG), liquefied petroleum gas,
naphtha and fuel oil.
Separately, we are actively engaged in
the development of Nigeria’s refining
sector, through discussions both with
NNPC and with the planned Dangote
refinery, and always looking for Angola
opportunities to develop captive power Trafigura has a long-standing relationship
supply projects for industrial plants. with the national oil company Sonangol.
In addition, Puma Energy has invested We are currently the biggest supplier
significantly in a Nigerian bitumen of gasoil to the country, while Puma
storage and distribution business which Energy, operating in Angola as Pumangol,
is well placed to benefit from future provides high-quality fuels through
infrastructure development. the country’s second largest retail fuel
distribution network. It also built a state-
of-the-art terminal for fuel imports linked
to the world’s largest Conventional Buoy
Mooring (CBM) system in Luanda Bay.

The Extractive Industries Transparency Initiative

(EITI)
Extractive Industries In 2014, Trafigura became the first independent commodities
Transparency Initiative trading company to declare support for the Extractive Industries
Transparency Initiative (EITI), a standard for promoting open
and accountable management of natural resources that counts 24 African countries as
members. By publishing our payments to state-owned enterprises in EITI countries where
we do business, we provide useful information on a matter of global public interest. We
have also been part of an EITI-mandated working group to help implementing countries
increase transparency about revenues received from commodity sales. Ghana and Nigeria
are among countries that are making active efforts to improve disclosures in this regard.
For more information on our payments to governments, please visit:
https://www.trafigura.com/responsibility/eiti/
10 Trafigura in Africa

Puma Energy:
a Trafigura investment in Africa

Trafigura is a 48.3 percent shareholder in Puma Energy, Apart from Trafigura, Puma’s business customers include many of
the largest independent storage and downstream company in the world’s leading mining companies and major players in power
Sub-Saharan Africa. Puma Energy began its African operations generation, construction, transport and other sectors where security
in Congo Brazzaville in 2002 and since then has expanded its of fuel and lubricant supply is a top priority. Its bitumen operations
footprint, both organically and through acquisitions, to its are also helping to pave thousands of kilometres of new roads across
current presence in 20 African countries. the region.
Downstream, Puma Energy sources and supplies a wide range Puma Energy continues to grow operations both organically and
of oil products, including fuel oil, gasoline, jet fuel, LPG, aviation through acquisition incorporating new businesses into its portfolio.
fuel, bitumen and lubricants. Its midstream activities support From 2008 to 2010, the Company acquired BP’s fuels and marketing
these operations. businesses in Namibia, Botswana, Zambia, Malawi and Tanzania,
Puma Energy is an important partner for Trafigura as it integrates launched in Mozambique, began work on two now-completed
fuel supply structures and invests in infrastructure. In the past four distribution terminals in the Democratic Republic of Congo and
years alone, Puma Energy has invested over USD1.2 billion across adapted its brand in the Angolan market.
Africa, upgrading storage and retail facilities to provide a secure www.pumaenergy.com
supply of high-quality products.
With its headquarters in Johannesburg, Puma Energy employs
over 3,400 employees in Africa, and has more than 40 terminals
with over 1.6mm3 of storage capacity as well as 850 retail sites.
Puma Energy also supplies 51 airports in the region with high-quality
aviation fuels, 12 of which came onstream in 2018.

20 3,400 858
Countries of operation Employees Retail sites

40 1.6 mm3 51
Storage terminals Storage capacity Airports supplied
 Trafigura in Africa 11

Puma Energy in Ghana: An integrated supply Puma Energy’s growing presence in Mozambique
chain through investments in infrastructure In November 2015, Puma Energy inaugurated two new
Ghana is one of Africa’s leading oil and gas producers and a key storage terminals in Mozambique. The bitumen and fuel
market for Puma Energy. terminals in Matola have raised Puma Energy’s total capacity
in Mozambique to 276,600m3 – the company’s second largest
Puma Energy first invested in Ghana in 2006 through CBM/
storage capacity in Africa.
SPM (Conventional Buoy Mooring/Single Point Mooring)
systems in a build-operate-transfer agreement. Operation and Focusing on integrated midstream and downstream
maintenance of the system, which imports over 80 percent of operations, Puma Energy’s model is to link local demand
the nation’s fuel, was officially handed over to the government with international supply, through investment in
in February 2017. infrastructure. Mozambique’s strategic location is ideally
situated to answer the supply requirements of South Africa
In 2016, Puma Energy officially entered the Ghanaian
and the sub-Saharan region.
downstream retail market and has been steadily since, now
operating 83 retail sites. Together with its storage terminals in Beira and bitumen
terminal in Matola, completed in May 2012 and June 2014
Since 2015, Puma has constructed four state-of-the-art
respectively, the strategic significance of the 115,000m3
storage terminals in Accra, Tema and Takoradi with a combined
fuel terminal reaches well beyond Mozambique’s borders.
storage capacity of 178,700m3. These investments have
While the bitumen terminal means that Mozambique is no
significantly improved security of supply and had a significant
longer dependent on imports from neighbouring countries,
impact on Ghana’s potential for trade and economic growth.
the fuel terminal creates a channel for the cost-effective and
At Tema, this includes a 100,000m3 multi-product secure supply of fuel to the Southern African Development
storage terminal that includes an LPG bottling plant with Community (SADC) sub-region.
8,000m3 of storage.
The Matola Fuel Terminal comprises 11 storage tanks, with
In a further move to increase the storage for jet fuel in the 115,000m3 of storage capacity, and this new infrastructure
country by an additional 30 days, Puma Energy has built two represents a catalyst for economic growth in the country.
terminals. At Accra a 10,000m3 jet fuel storage facility supplies The massive investments that these state-of-the-art terminals
Kotoka International Airport with 60 percent of its aviation are a clear indication of the company’s confidence in the
fuel and a 16,000m3 jet fuel storage depot at the port of Tema. sustainable growth of Mozambique.
Elsewhere in the country, Puma Energy’s Takoradi terminal
was developed to primarily serve the Ghanaian mining
industry. The 32,000m3 facility is the only depot of its 178,700 m3
kind for the storage of gasoline in this key area of growth Total storage capacity in Mozambique
and development, and has reduced the need for delivery
trucks to drive 135km from Accra to Takoradi. The improved
infrastructure is another example of how Puma Energy
contributes to the development of a safe and professional oil
and gas distribution system.

276,600 m3
Total storage capacity in Ghana
12 Trafigura in Africa

Case studies:
Fuelling African energy demand

West African bunker fuel Supplying gasoline to DRC

With the lively movements of ships plying the ports along the Congo River
of West Africa comes a strong demand for supplies of One of the trickier logistical challenges Africa has to
fuel to power them – bunker fuel as it is known in the offer is that of bringing gasoline to the land-locked
trade. This is one of the more physically challenging markets of the western Democratic Republic of the
businesses in the region, involving complex logistics and Congo, including the capital Kinshasa, one of the
the need for extreme operational flexibility. It’s another continent’s fastest-growing urban centres. Uniquely,
of Africa’s opportunities that Trafigura has risen to in Trafigura meets this challenge by shipping gasoline
recent times, achieving rapid growth in regional market up the Congo River from ocean ports on the coast of
share with a dedicated bunkering team serving all the northern Angola.
key commercial centres in the region from Conakry to
It’s an approach that requires long-term investment in
Cape Town.
infrastructure, flexibility, attention to detail and a deep
The key challenge for bunkering in the region is that understanding of the region as a whole as well as the
physical supply has to take place offshore via ship-to- linkages between its different parts. Our presence along
ship (STF) transfer. Trafigura has an offshore floating the coast enables us to supply multiple countries on
storage aboard a Suezmax tanker moored off Lomé, one voyage by a 40,000-tonne Medium Range tanker,
the capital of Togo. It supplies ships with a fleet of ten thus generating efficiencies and cost-savings. For DRC,
chartered vessels that operate rather like a chain of gasoline cargoes are discharged at Banana or Pointe
mobile gas stations, going where the ship-owners need Noire, then sent in smaller vessels up-river.
them and supplying vessels ranging from oil drilling
The key river-side asset at our disposal is the 26,000m3
rigs to tankers, bulk freighters, container ships and
SPSA Terminal at Matadi, the entry point to the western
fishing vessels.
DRC. This terminal, built at a cost of USD50 million
Such is the operation’s success that it now forms part by our partner company Puma Energy, is the only
of a new joint venture between Trafigura and two of the functioning logistical facility in the region and is in turn
world’s largest ship-owners to create a leading global connected by pipeline to Kinshasa. From there supplies
supplier of marine fuels. can also be barged across to Brazzaville on the opposite
bank of the Congo, and onward by barge or truck to the
remote Central African Republic.
Supplying by barge is much more secure and traceable
than using trucks, also enabling tax collection and
combating smuggling. Thus the wider regional economy
can benefit from growing demand for fuel.

150,000 mt

West African bunker fuel

moved per month
 Trafigura in Africa 13

The Mozambique pipeline and Zimbabwe Meeting changing needs in Egypt

Trafigura prides itself on placing security of supply to and the Horn of Africa
its customers at the heart of its operations, even in the Major structural changes have been underway in the
most financially challenged markets. Zimbabwe is a case energy markets of Egypt and north-eastern Africa in
in point. Trafigura has a significant share of the market recent years, as new sources of supply and demand open
to supply fuel to the land-locked country, working with up. Thanks to its logistical and financing capabilities and
our partner company Puma Energy which has its own to its access to global commodity flows, Trafigura has
retail network. been able to play an important and innovative role in
Together we have kept the pumps in operation the region.
throughout Zimbabwe’s eventful recent history and We helped Egypt navigate rapid changes in its energy
recurrent balance of payments problems. Key to supply and demand position at a time of financial
this feat is our investment in a complex logistical strain. In 2015, Egypt faced a significant need to import
chain stretching from storage tanks in-country back Liquefied Natural Gas (LNG) as its domestic gas reserves
through a 500km pipeline across Mozambique to became depleted. Working with a new delivery system
the Indian Ocean port of Beira, where Trafigura known as a Floating Storage and Regasification Unit
uses Puma Energy’s first-class storage assets – one (FSRU), Trafigura won the first major tender to supply
of the few facilities in the city to have been unaffected Egypt with LNG at competitive prices. With the FSRU
by Tropical Cyclone Idai in March 2019. – a specially converted ship enabling a buyer without
But an additional important feature is Trafigura’s established infrastructure to access LNG supplies quickly
willingness to go the extra mile to honour its supply and at relatively low cost – Trafigura helped the client,
contracts, and to work with customers including the Egyptian General Petroleum Corporation, to make the
government to offer them tailor-made solutions, such as shift at speed, supplying more than 100 cargoes of LNG.
longer payment terms, additional supplies via alternative More recently, substantial new gas finds have enabled
routes or special arrangements to create buffer stocks Egypt to resume its traditional role as an exporter of gas,
against expected supply shortages. Whatever happens, and here too, Trafigura became a substantial off-taker of
the customer comes first. Egyptian production.
In logistically-challenged Sudan, Trafigura has become
the leading importer of diesel, fuel oil, gasoline and
liquefied petroleum gas (LPG), having built an important
storage position in Port Sudan. Keeping products in
these tanks enables us to unload material in bulk at
the port – reducing shipping demurrage fees – and sell
smaller quantities at competitive prices as the market
requires. Our on-the-ground experience gives us the
confidence to manage risk and ensure reliable supplies
even during recent times of civil disruption. We are

500 km
constantly on the alert for emerging opportunities as
other regional markets open up.

Pipeline to Beira
14 Trafigura in Africa

Developing new markets and

assisting Africa’s energy transition

Africa's energy and raw materials are changing. As a leading global LPG in West Africa
commodities player, Trafigura sees creating the basis for future Liquefied petroleum gas (LPG) has become an important ‘transition
development as key parts of its mission – by rapidly opening up fuel’ for Africa, notably in meeting basic needs such as cooking. It is
markets for new, more environmentally-friendly fuels, by facilitating cheaper than alternatives such as kerosene. It is cleaner than burning
urgently needed new methods of supplying markets such as trading traditional fuels such as wood, and can be supplied without building
of power, and by introducing the latest technologies to generate costly new infrastructure. LPG is also increasingly used in power
renewable energy. generation, and again is a lot cleaner than heavy fuel oil.
As African countries move to reduce permitted sulphur content in Trafigura has become a leading supplier of LPG to West Africa,
fuels, Trafigura is supplying the higher-quality imported materials thanks to our leading position in exporting the abundant and cost-
the market needs. We are working to develop, connect and supply competitive new supplies coming out of the shale fields of the US
power projects as more integrated regional markets emerge. And we and to the logistical network we have created in co-operation with
are pioneering investment in renewables such as solar power. partner company Puma Energy.
The transition towards a lower-carbon economy is coming to Africa, We bring LPG to the region on large specialised vessels before
and Trafigura is playing its part. breaking cargoes into smaller volumes that can be delivered into
local ports. Keeping reserves of product on an offshore logistical
platform enables us to make supplies available to countries which
do not have adequate storage capacity and to react quickly to any
shortages. And the cost savings achieved by efficient handling at
scale can be passed on to our customers.
 Trafigura in Africa 15

Helping meet Africa’s power needs Impact investing for clean energy with PASH
Boosting supplies of electric power is critical to economic growth. Trafigura holds a majority shareholding in Pan-African Soleil
In Africa, lack of access to electric power is a major constraint. Holdings Inc. (PASH), one of Africa’s most significant impact
But across the continent, numerous projects are underway which, investors in the clean energy sector. Leveraging the latest in
once completed, will help to address the power deficit in individual innovation in technology, PASH develops, finances, builds, operates
countries but also, by linking national power grids, create more and maintains power assets globally.
efficient regional electricity markets, or ‘pools’. As an impact investor, PASH works beyond its bottom line to
Trafigura is a leading supplier of fuels to African power generating enhance the social and environmental impacts of its projects.
utilities, and is working with national authorities on many of the This involves addressing basic services including housing, healthcare,
more important projects that may require debt or equity finance as education and quality of employment.
well as long-term fuel supplies. Developing bespoke power solutions for the commercial and
In Ghana, for example, we have invested in an efficient new industrial (C&I) customers is its main focus. However, they
combined-cycle 107 megawatt power plant designed to run increasingly develop utility scale projects for governments
on natural gas. In Mozambique, we are working with Afrochine around the world.
to develop a 120 MW plant at the port of Beira that will help PASH has a highly experienced management and technical team
address power shortages in Zimbabwe. In both Benin and Togo, with extensive development and execution expertise, including
we have partnered with power generation companies to provide involvement in over £100 billion in energy and infrastructure
LPG for power. Both projects are expected to come online in the transactions on every continent.
course of 2020.
We expect growth to accelerate as regional power trading in the Investing in the largest solar farm in West Africa
region takes off, for example in the Southern African and West PASH has acquired a 50 percent stake in a Malian solar farm set to
African Power Pools. become the largest in West Africa and one of the largest in Sub-
Saharan Africa, with an installed capacity of 50 MW.
MOROCCO <1 TUNISIA
<1
The solar farm will provide more than 91,702 households in Mali
ALGERIA
LIBYA EGYPT with green electricity, saving more than 51,700 metric tonnes of
WESTERN <1
SENEGAL
SAHARA <1 <1 carbon emissions per year. Importantly, the project will also create
6 <1
MALI
ERITREA many local jobs for the Malian people along with the other social
1 4
MAURITANIA
11 NIGER
SUDAN benefits that PASH is known for as an impact investor.
CAPE VERDE 15 CHAD DJIBOUTI
24
<1 BURKINA-FASO 12 <1 The build, own, operate and transfer concession was signed in 2015
14
GAMBIA 1 NIGERIA
9 SOMALIA
on a 30-year basis with a 28-year power purchase agreement with
GUINEA- 93 ETHIOPIA
BISSAU
1
35
SOUTH
CENTRAL SUDAN
79
national power company, Energie du Mali. It is the first utility-scale
4 AFRICAN 11
10 6 4 CÔTE D’IVOIRE REPUBLIC renewable project in Mali.
KENYA 11 UGANDA
GUINEA SIERRA LIBERIA
GHANA 3 DRC
LEONE 15
60
TOGO 5 10 RWANDA
TANZANIA
BENIN 7 36 9 BURUNDI

15 <1 COMOROS
10 14 MALAWI
10 <1 1 1 ANGOLA
ZAMBIA MAURITIUS
CAMEROON EQUATORIAL GABON REPUBLIC OF NAMIBIA ZIMBABWE <1
GUINEA THE CONGO
1 8 15
2
BOTSWANA MOZAMBIQUE 19 MADAGASCAR
Share of population without
access to electricity
>75% 25% to 50% SOUTH AFRICA 1 ESWATINI
50% to 75% <25% 8 1 LESOTHO

50 91,702
#
Population without access
to electricity (millions)
MW

Solar farm Households provided with power

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Last updated: October 2019 any particular company or companies.