Advertisement

Four firms submit bids for Sh210bn Uganda oil refinery

Tuesday June 17 2014
refinery-pix

The four firms vying for the role of lead investor are China Petroleum Pipeline Bureau, Marubeni Corporation, RT–Global Resources and SK Group. FILE

The setting up of the planned Uganda oil refinery, in which Kenya has invested Sh6.5 billion, has moved closer to fruition after four firms submitted proposals at the end of last week.

According to a statement from Uganda’s Ministry of Energy and Mineral Development, the firms, which are vying for the role of lead investor, presented proposals for the development of the Sh210 billion refinery.

The four companies are China Petroleum Pipeline Bureau (CPPB), Marubeni Corporation from Japan, RT–Global Resources from Russia and SK Group from South Korea.
The contract involves refining the oil and subsequent delivery to the market.

“Four of the six shortlisted firms/ consortia have submitted detailed proposals to the Government of Uganda for the role of lead investor/operator for the development of the 60,000 barrels per day oil refinery and related downstream infrastructure in the country,” said the Ugandan Ministry in a statement.

Early this year, Kenya said it was taking a three per cent stake in the refinery worth Sh6.5 billion after the Uganda government offered stakes to countries in the region.

Major projects

Advertisement

Kenyan energy officials, however, stressed that they were still moving on with home-grown plans for a local refinery.

Uganda’s Ministry of Energy and Mineral Development permanent secretary, Mr Fred Kabagambe-Kaliisa said the government was looking for a credible, experienced and financially capable partner to work with Uganda to develop a refinery.

The China Petroleum Pipeline Bureau and its consortium members have executed major refining and pipeline projects in India, Chad, Kenya, Thailand, Mozambique and China. The Chinese company was awarded a tender together with the National Oil Corporation of Kenya (NOCK) for the Kenya-Uganda multi-product pipeline project stretching 345 kilometers.

The Japanese firm, Marubeni Corporation, has developed power projects, refineries, petrochemical plants, upstream assets and gas infrastructure in a number of countries, including the United States, United Kingdom, India, Qatar, Russia, and Kazakhstan.

The Russian state-owned international company finances large infrastructure projects and with its consortium members have developed key refining projects in Russia.

Concluding negotiations

The South Korean firm owns the second largest refinery in the world, producing 1.12 million barrels per day.

A team comprising representatives from the Government of Uganda together with Government’s Transaction Advisor, TaylorDeJongh, is evaluating the proposals. The evaluation is expected to take one month after which the results will be announced.

Negotiations to start development are expected to be concluded by the end of September this year.

Advertisement