Don’t forget to come hear Sara Johnson, Economics Executive Director at IHS Markit, speak tomorrow at the NABE Econ… https://t.co/yHX8U9SP8Z
Cameroonian secessionist capability
Anglophone secessionists have claimed responsibility for a storage tank explosion on 31 May at the Sonara oil refinery in Limbe, in Cameroon's Southwest region. The subsequent fire damaged four of the facility's 13 production units and halted production at what is the country's sole refinery.
The Interim Government of the Republic of Ambazonia, which is the self-declared government in exile of the Northwest and Southwest regions and is not recognized internationally, released an online statement claiming that that its affiliates in Anglophone separatist armed groups who operate in Cameroon's English-speaking Northwest and Southwest regions caused the fire in a sabotage attack. The statement said that the attack targeted the refinery because it benefits the Francophone majority over English-speakers, despite being located in the Anglophone Southwest region. The government denied the claim and stated that their investigations indicated that the fire was caused by an accidental fault.
As Cameroon's only oil refinery, the Limbe facility supplies around 80% of the country's petroleum products for domestic consumption when operational. As such, shortages of refined petroleum products in Cameroon are increasingly likely while the refinery is repaired, which is likely to take between six and 12 months. In fact, national refinery company Sonara, which operates the facility, claimed force majeure due to the fire on 1 June. On 2 June, the minister of energy stated that, beginning on 4 June, refined petroleum imports would cover the shortfall.
The cause of the explosion and subsequent fire at the refinery is unverified. According to IHS Markit Energy, the refinery was poorly maintained. Anglophone separatists have not previously conducted an attack against such a large fixed asset with dedicated military protection. Rather, they tend to attack military patrols, kidnap local officials and students and commit arson against smaller state assets, such as agricultural processing units, with little or no dedicated security. These factors indicate that the explosion was an accident. However, as an asset 96% owned by the Cameroonian government (the other 4% is owned by Total), attacking the refinery correlates with the separatists' aspirational target set.
If IHS Markit observes credible reports of an increased proliferation of weapons such as rocket-propelled grenades, improvised explosive devices, and light machine-guns among Anglophone separatists, we assess that attacks on fixed-asset, militarily guarded government property such as the Sonara refinery will increase.
Posted 14 June 2019 by Will Farmer, Country Risk Analyst, IHS Markit
- Lebanon banking crisis
- Weekly Pricing Pulse: Commodity prices rise before news of Covid-19 spread
- Capital Markets Weekly: Investor yield hunger underpins record Italian syndication
- Malaysian economic growth moderates in Q4 2019
- Houthis selecting more UAVs over ballistic missiles in Arabian Peninsula attacks
- Coronavirus economic shockwave hits the APAC aviation industry
- Weekly Pricing Pulse: The coronavirus hammers commodities
- Djibouti contract and tax risks
See you next week at the NABE Economic Policy Conference. Don’t miss hearing our Economics Executive Director, Sara… https://t.co/GcyKfIe9wu