National
Uganda invites interested firms to build oil refinery
Publish Date: Oct 09, 2013
Uganda invites interested firms to build oil refinery
  • mail
  • img
newvision

By Ibrahim Kasita

Uganda has invited interested firms to express their interest in building and operating the proposed oil refinery to promote valuable use of the country’s petroleum resources.


The Uganda Refinery Project will have the capacity to process 60,000 barrels per day and will be located in Hoima.

In a Request for Qualification published on Monday, to identify a lead investor/operator for the development of the project, a private sector partnership will be established to encourage investment and technological innovation.

This arrangement is expected to provide the best, brightest and most cost-effective solution for the project in which government (public) will hold 40% equity. The balance of 60% shares goes to the private sector/s.

Already Uganda has invited the four East African partner states to invest in the 40% public shares in the proposed Uganda oil refinery.

According to the development timeline, the selection of the lead investor/operators will in mid-next year and it is expected the refinery will be in operation by 2017/18.

This date of 2017 coincides with the expected completion timeline of the Kingfisher Field development phase being undertaken by the China’s National Offshore Oil Corporation (CNOOC Uganda).

Uganda awarded the first production license to CNOOC Uganda last month and the first production is expected 2017/18.

“We are committed to a transparent process to develop Uganda’s first oil refinery, Fred Kabagambe-Kaliisa the permanent secretary in the ministry of energy and mineral development, said.

“This Project marks the start of Uganda’s energy independence and the refinery will enhance Uganda’s energy security by unleashing the opportunity of our country’s rich oil resources, which some have described as the largest onshore oil discovery in Africa in the past 20 years.”

The Uganda Refinery Project has significant higher gross refining margin than international levels due to inland location, the composition of the crude oil used as feedstock and the markets the refinery will serve.

 There is high demand for petroleum products in Uganda, Rwanda, Burundi, eastern Democratic Republic of Congo, Southern Sudan, Kenya and Tanzania as the East African economies expand.

The refinery project is expected to make use of Uganda’s oil and gas resources to contribute to early poverty eradication and create lasting value to society.

This will be by meeting Uganda’s growing energy needs for petroleum products and electricity, enhancing energy security by reducing the need to import petroleum products, improve the balance of payments and creating investment opportunities in other sectors in the economy.

During the construction phase, it is estimated that between 4,000 and 6,000 jobs will be created. Once completed it is expected 650 permanent jobs will be created and most of them will be Ugandans.

Uganda has established the legal basis for the Project. Parliament enacted the Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act that will provide the framework for the development of the downstream petroleum sector in Uganda, which includes this Project.

The transaction advisory team is led by independent investment banking firm Taylor-DeJongh. Since 1987, Uganda’s economy has been growing at twice the rate of Sub-Saharan Africa.

Uganda is ripe for investment and holds abundant energy resources―approximately 3.5 billion barrels of oil (of which 1.2-1.7 billion is commercially recoverable) and 350 billion cubic feet of gas in the Lake Albert region.


 

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Ex-PM Mbabazi entitled to sh2.1m pension
Former Prime Minister Amama Mbabazi once said he was not finished and indeed he is not, especially in the wallet....
Mother declines cash to marry off P.6 daughter
A 37-year-old woman from eastern Uganda is the talk of the town after she rejected sh602,000 from a suitor who wanted to marry her daughter....
14 killed in DR Congo machete attack
THE incursion by the Ugandan rebel group ADF took place overnight in the town of Kampi ya Chui....
Businessman sues UNRA over Entebbe Expressway
A businessman has dragged UNRA to court seeking sh5b in damages for loss of business and the inconvenience over the construction of the Entebbe Expressway....
US Commander of Africa Forces visits
President Yoweri Museveni has said that the main challenge in Somalia today was clan-related issues. The President made the remarks at State House Entebbe in a meeting with the United States of America Commander of Africa Forces, General David Rodriguez....
Museveni hails Uganda-North Korea ties
President Yoweri Museveni describes the North Koreans as friends who have helped Uganda for a long time on visit of one of its leaders....
Should the absence of bride price prevent couples from wedding?
Yes
No
Can't Say
follow us
subscribe to our news letter