Uganda – Oil Refinery Project

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The government seeks to resolve tender for huge project, as they look to Nigeria for advice. 

Uganda has shortlisted four companies for the construction of the US$4.27bn (UShs 15.3 trillion) oil refinery, according to Energy Minister Irene Muloni.

Muloni made the announcement during a session of the joint Uganda Chamber of Mines and Petroleum, Uganda Freight Forwarders Association and Private Sector Foundation, inaugural logistics fair in Kampala from April 25-27th.

A decision on the chosen tender is to be made within a month, said acting director of the refinery, Robert Kasande. However, others have said there are not four but eight companies in the bidding.

The companies are Canadian firm SNC Lavalin, United States (US) firms Yatra Ventures LLC and Apro, and Turkish firm IESCO. Others include Chinese-based Guangzhou Dongsong Energy, Spanish firm Profundo Bantu Energy, and Italy’s Maire Tecnimot.

Uganda had previously picked Russian firm RT Global Resources, but the Russian eventually pulled out citing failures by the Ugandan government to meet demands.

The decision needs to be made soon to allow a final investment by three oil firms, CNOOC, Total and Tullow, which revolves around the US$3.5bn East African Crude Oil Pipeline from Hoima disrict in Uganda to Tanga Port in Tanzania. The 1445km pipeline will be the longest electrically heated pipeline in the world, with a capacity of 200,000 barrels per day.

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Tullow Oil Refinery – CC 2010 

Another central aspect of the project is a refinery to be built at Hoima, for which financing is still yet to be ascertained, reported the Monitor.

In February the government relocated 46 families to make way for the refinery in Kabaale parish, Buseruka sub-county, Hoima. In June 2012 the government acquired the 29 square kilometres of land, covering 13 villages and displacing 7118 people.

Francis Elungat, the Land Acquisition Officer from the Ministry of Energy and Mineral Development said, “each family has been promised a cow, two goats, 10 kilograms of maize seedlings, a machete, hoe and other domestic tools,” adding that these supplies are meant to sustain the families until they will be self-reliant, reported Oil in Uganda. 

According to the Deputy Commander of Operations for Wealth Creation in Uganda, Lt Gen Charles Angina, Uganda is looking to learn from Nigeria in the oil sector.

“Nigeria is our admired African country who have demonstrated and exhibited local content in building and running its energy sector. And they have managed to promote this particular sector to a point that Nigerians now actively involved in different segments of the nation’s oil and gas sector. We felt Nigeria is the best country to come and learn from as well as work with our brothers and sisters of Nigeria, so that we can be able to do the same in building the local content in Uganda, so that together we benefit as Africans,” he said.

“As it stands today, most of what we see in the field today, in terms of operators and operations in the sector were formerly dominated and run by foreign companies like Shell, Total, ExxonMobil, but today, Nigeria has gained substantial control of this sector,” Angina added, reported This Day.

In Uganda, at least six major oil-related engineering projects are rolling and major project milestones are set for August and December, with numerous other small deadlines.

Find out more in the Africa Research Bulletin:

UGANDA: Drought Hits Hard
Economic, Financial & Technical Series
Vol. 53, Issue. 12, Pp. 21533A–21534A

UGANDA: Diversify From Oil, World Bank Advises
Economic, Financial & Technical Series
Vol. 53, Issue. 6, Pp. 21315A–21315C

UGANDA: Major Investments
Economic, Financial & Technical Series
Vol. 53, Issue. 5, Pp. 21283A–21284A

Subscribe to the Africa Research Bulletin today. 

 

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