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SAMIR to Shut Down, Workers Struggle to Salvage the Facility 

Morocco’s only oil refinery has until July 18th to find a buyer.

Rabat – Once an economic flagship, Morocco’s single oil refinery has been in decline since 2015 and now faces permanent closure in less than a month. 

In 1959, the Moroccan government established the refining company, SAMIR, in Mohammedia. It was sold to the Corral group, a Saudi-Swedish enterprise, in 1997.

Unable to honor $4.5 billion in borrowing, the firm was then liquidated by a Casablanca court in 2016. 

The court has extended the deadline to keep the refinery open a dozen times, with the final extension set to expire on July 18. 

The refinery once had a capacity of producing more than 150,000 barrels a day, but work at the plant slowed to a stop in 2015.

Since then, a self-titled “national front” of employees, economists, and union leaders have been pressuring the government with sit-ins and press conferences to revive SAMIR. 

Staff representative Houcine El-Yamani has lead the efforts of the “national front” to salvage the plant. In 2018, his team issued a report to Moroccan authorities denouncing the 1997 privatization and sale of the refinery, which was “totally lacking in transparency.”

The report accused the Corral group of disrespecting its contract and triggering the demise of SAMIR. 

The report also claimed that the government has no interest in salvaging the country’s sole national refinery. Minister of Energy and Mines Aziz Rebbah dismissed these allegations. 

Meanwhile, a trade court has been actively seeking a new owner. Around 30 international groups have expressed an interest in SAMIR over the years, but nothing has come to fruition.  

Read also: Bid for Morocco’s SAMIR Refinery amid Fresh, Unsettled Controversies

As recently as June 2019, Exol Lubricants Morocco offered $8.23 million to obtain the assets of SAMIR. However, the offer was not well received by the refinery’s shareholders or by SAMIR employees, who consider the price to be “below market standards.”

Other contenders include Swiss-British Glencore and Geneva-based Trafigura, who have offered $14.99 million and $11.70 million, respectively. 

Earlier in 2019, a report by the International Energy Agency detailed Morocco’s dependency on coal, oil, and gas imports to meet most of its energy needs. “The closure of the country’s only refinery . . . has clear implications for the security of [Morocco’s] oil supply,” the report reads, recommending the development of domestic energy resources.

Around 800 employees are still on the company’s payroll, with the upcoming closure of the facility posing a dire threat to their livelihoods.