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Namibia looks set to build its first oil refinery following a meeting between President Hifikepunye Pohamba and an Al-Fiyad Universal Group business delegation from the Kingdom of Saudi Arabia.

The delegation was led by group chairperson Abdullah Saad Abdullah and Chief Executive Officer of Central Oil Namibia (Pty) Ltd, George Iita.

The purpose of the meeting was to get the go-ahead for the construction of a refinery plant in Walvis Bay, according to market sources.

Speaking to the media after the meeting, Ita said that they had already looked at a site in Walvis Bay for the new facility.

The refinery is expected to cost around US$1 billion and take between three and four years to build.

Ita said that the refinery will give Walvis Bay, the country's main bunkering location, a massive economic boost.

The Namibian bunker market receives strong demand from fishing fleets operating in the area. However, with no refinery, fuel is mainly sourced from South Africa.

The production of fuel oil at a refinery in Walvis Bay would not only potentially lead to Namibian bunker prices becoming more competitive, but also attract new business from ships using the new facility.

High seas specialists include Addax Bunkering Services, Wrist Bunker Supply GmbH and SK Shipping Co. Ltd. In Walvis Bay, BP Southern Africa (Pty) Ltd, Shell Namibia Ltd., Chevron (S.A.) (Pty) Ltd. and Engen Petroleum are able to supply marine gasoil (MGO) ex-pipe or by truck.