Energy Ministry calls upon investors to take advantage of the key investment opportunities in Uganda’ oil and gas sector

By Sierra Ruth Arinaitwe

Uganda’s Minister of Energy and Mineral Development Hon. Ruth Nankabirwa Ssentamu has called upon investors attending the Abu Dhabi International Petroleum exhibition and conference (Adipec) to partner with Uganda in developing the country’s oil and gas resources.

While giving her remarks during the conference held in Abu Dhabi, the minister pointed out that at the moment, Uganda has two significant players in the petroleum upstream: Total Energies E&P Uganda overlooking the development of the Tilenga Project with facilities to support petroleum production from six oil fields located in the Buliisa and Nwoya districts and CNOOC Uganda Limited operating the Kingfisher Development Area (KFDA) Project situated in Kikuube and Hoima districts.

Nankabirwa told the investors that the discovery and development of petroleum projects in the country calls for the need of a refinery to process the crude oil discovered to produce petroleum products for the country and the region as East Africa has only one refinery which is currently not operating.

The minister cited that Uganda entered into a Project Framework Agreement (PFA) with the Albertine Graben Refinery Consortium (AGRC) to develop a 60,000 barrels per day oil refinery. “The refinery in Uganda will boost the region’s refining capacity and ensure the security of petroleum products, especially for the landlocked the partner states such as Rwanda and Burundi,” she said.

Nankabirwa also pointed out that the government is also in the advanced stages of securing a strategic partner to develop the associated infrastructure of the refinery project such as the supply pipeline and storage facilities.  “The government is acquiring land for the 213km refined products pipeline from the Refinery to the Kampala Storage Terminal (KST) in Namwabula, Mpigi district. We have already acquired 299 acres to develop KST – a 320-million-litre multi-user petroleum storage and distribution terminal,” she said.

She further informed them that the government has already agreed with licensed oil companies on a commercialization strategy that includes the use of petroleum for power generation, supply of Crude Oil to the Refinery, and the export of Crude Oil through an export pipeline. This is evident by the agreements signed with Tanzania to develop an East African Crude Oil Pipeline (EACOP) Project.  “The Project is the planned 1,443km heated and buried pipeline transporting crude oil from the collection point in Hoima district in Uganda to the Port of Tanga in Tanzania,” Nankabirwa said.

The country is also developing the Kabaale Industrial Park (KIP) that will accommodate anchor projects such as the Refinery, the second largest International Airport in Uganda, Crude Oil Export Hub, and petro-based industries such as plastics, fertilisers, and petrochemicals.

Nankabirwa pointed out that Uganda’s major priorities in the oil and gas sector are: to conduct petroleum exploration and development to achieve local production; to put in place and implement policies and legislation that enable investment and flow of capital in the petroleum industry, the acquisition of skills and technology, value addition in the petroleum resources, and ensure the security of supply and competition in the petroleum market.

It is at this point that the minister urged investors to take advantage of the key investment opportunities in Uganda’s emerging oil and gas sector. Among these include; capital for the emerging infrastructure such as refining and transportation of petroleum commodities and products; Service provision and contracts in the fields of Engineering, Procurement & Construction in taking forward the development of this infrastructure; Power generation using gas and some crude oil by Independent Power Producers.

Development of a Petrochemical Industry; Logistical services; Waste Management and Treatment; Joint Ventures and farm-in arrangements in existing licenses; Geophysical surveys, particularly nonexclusive seismic surveys in the unlicensed areas; Oil and Gas field services, including operation and maintenance of rigs and other drilling-related services.

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