Ronier–Djermaya Oil Pipeline

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Ronier–Djermaya Oil Pipeline, also known as Bongor Field Area Pipeline, is an oil pipeline in Chad. The pipeline runs approximately 300 kilometers from the Ronier, Mimosa, and Koudalwa oil oilfields in the Bongor Basin North to the Djermaya oil refinery.

Location

The pipeline runs from Bongor basin (Ronier/Koudalwa oil fields) to the Djermaya refinery, north of N'Djamena in Chad.

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Project details

• Operator:
• Owner: PipeChina
• Parent: PipeChina
• Capacity: 20,000 barrels per day
• Length: 300 kilometers
• Oil source: Koudalwa/Bongor field, Chad
• Status: Operating
• Start year: 2011

The pipeline was originally owned by the Chinese National Petroleum Corporation (CNPC), which was later merged into the conglomerate PipeChina.

Background

In June 2009, CNPC began construction of the 300 kilometer pipeline linking the Koudalwa/Ronier oil production sites in the Bongor basin to the Djermaya refinery, north of N'Djamena. The associated Djermaya refinery was 60% owned by CNPC and 40% by the government of Chad. While it was proposed by President Idriss Deby Itno's office that the Koudalwa oil field could produce up to 60,000 bpd, the pipeline has been reported to transport up to 20,000 bpd and was completed in 2011. The pipeline is the first major energy passage from South to North Chad and was a part of the Djermaya refinery project. Oil from this project came to Chad's domestic markets in 2011, but did little to decrease fuel costs for people thoughout the nation. In October 2020 ownership of the pipeline was transferred from CNPC to PipeChina.

Refinery Closures

Since the construction of the Djermaya refinery north of the capital and its corresponding pipeline, the country has experienced a steep decline in oil production accompanied by an increasingly tumultuous relationship with China. While China had promised infrastructure projects such as schools, hospitals, roads, and cheap fuel prices in exchange for rights to Chad's oil fields, its investment has come with significant environmental and other problems.

Since the opening of the Djermaya refinery, it has closed on multiple occasions due to price disputes between CNPC and the Chadian government. The agreement between Chad and the Chinese company was based on regular exports of oil and affordable prices of refined fuel products for the local population. Once China reneged on those terms in the eyes of the Chadian government, the refinery was shut down for a period of time. The prices set by the government of Chad on products from the refinery were too low for its Chinese partner operating the refinery, thus prompting a suspension of the refinery contract by state officials. Matters were only worsened when the Chadian government removed the CNPC director of the refinery from the country. The refinery, which cost $758 million, has lost nearly $5 million since it opened due to multiple closures. The conflict of the refinery also occurred on the heels of massive infrastructure agreements between Chinese state-run companies and the Chadian government. The refinery would eventually reopen once a new a contract was made.

Spills

In 2013, the government of Chad suspended all operations conducted by CNPC in the country due to environmental degradation in the Koudalwa oil field south of the capital. After a visit to the oil exploration area, Chad's oil minister announced the situation as "intolerable," as trees had been destroyed and oil unsafely discarded in trenches, where workers discarded it by hand Shortly thereafter, the government initiated an environmental audit to examine all potential regulatory violations by the Chinese company. In October of 2013, CNPC's suspension was lifted. But in 2014, Chad's government fined CNPC $1.2 billion for its violations of environmental regulations in the oil producing areas. On top of the fine, the government demanded that the company strictly adhere to environmental regulation, especially rules dealing with waste management.

Opposition

Civil society groups and activists claimed that the environmental assessment was inadequate and residents were not consulted on the project. Villagers did not have knowledge of the pipeline's specific route or the impacts it would have on them. The government stated that it would compensate any villages that were affected by the pipeline, but groups remained uncertain of their actual commitment. All together, the pipeline would traverse through 26 different villages according to reports.