The Observer (Kampala)

18 March 2014

Uganda: Oil Refinery Winning Bidder to Be Announced in June

Six firms bidding to build Uganda's oil refinery are set to visit the proposed site for the oil refinery in Kabaale, Hoima district. The firms last week met with officials from the ministry of Energy and Mineral Development at Serena hotel, Kampala, and agreed to visit the oil fields in the Albertine graben as well.

In a statement after the meeting, Irene Muloni, the minister of Energy and Mineral Development, said the meeting was held to discuss the bidding process and ensure transparency.

"We invited the bidders for this conference to share with them information on the developments in Uganda's oil and gas sector, and more specifically to introduce the refinery project. We have discussed the proposed project structure, base case configuration and addressable market for the refinery, the relevant agreements, and the scoring criteria for both technical and financial proposals."

The bidders are also expected to meet officials from China National Offshore Oil Corporation (Cnooc), Total E&P Uganda Ltd and Tullow oil, three companies currently undertaking oil exploration and development. The bidders are required to present their detailed proposals for the refinery project to government by April 16, 2014.

These proposals will include a project implementation plan that highlights the management of logistics associated with the project given its remote location, project risks and mitigations, together with security, safety, health and environmental strategy and principles.

Robert Kasande, the refinery project manager, said the project implementation plan should also include a local content strategy that illustrates how the bidders intend to maximize the use of Ugandan employees and resources.

"The proposals will include a detailed technical concept highlighting the refinery design the bidders intend to implement, taking into consideration the petroleum products market and fuel specifications in Uganda and the East African region. The shortlisted bidders will also submit a financial plan highlighting how they intend to raise funds for the project.

In addition, they are also expected to document their plan for crude oil procurement and sale and marketing of refined products," he said.

The six firms are China Petroleum Pipeline Bureau, Petrofac from UAE, RT-Global Resources from Russia, Vitol SA from Switzerland, SK Energy from South Korea and Marubeni Corporation from Japan. The winning bidder is expected to be announced in June.

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