The three joint venture partners operating in the Albertine Graben have launched the Front End Engineering Design (FEED) studies for Nwoya and Buliisa oil fields in a bid to fast track oil production by 2020.
Total E&P Uganda , Tullow oil and China National Offshore Oil Corporation (CNOOC) signed the pact yesterday (February 14, 2017) at Sheraton Hotel in Kampala and was witnessed by Minister for Energy Eng. Irene Muloni, Mike Cleaver Vice President of Chicago Bridge and Iron Company(CBI) , Ashley Rees Managing Director of Fluor and Maxine Mikoyan Vice President of Technip.
Technip, Fluor and Chicago Bridge and Iron Company (CB&I) are the three international contractors that were awarded the contract to undertake the first phase of FEED design completion for a period of six months. Upon successful completion, the two best companies will be invited to compete for Engineering, Procurement and Construction contract.
The FEED studies which will cover Exploration Area 1 (EA1) in Nwoya and Exploration Area 2 (EA2) in Buliisa respectively are expected to outline technical aspects of the oil fields (design of trunk pipelines-crude feeder pipelines, Central Processing Facilities which is the most critical infrastructure since it is like 'first refinery' and other attendant infrastructure), costs estimates and schedules of implementation of the production phase.
According to Energy Minister, Eng. Irene Muloni, who was present at the signing of the design engineering studies framework, Uganda's target of having first oil remains 2020.
"We gave the joint venture partners up to the end of this year (December 31, 2017) to make a Final Investment Decision (FID); a decision on whether to invest or not to invest in our country," she said, adding that government expects the oil companies to abide by the agreed deadline as penned on the production licenses awarded last August.
"Joint venture partners have sunk in over $ 3 billion for the last 10 years. So they are also looking forward to recouping their investment and everyone is asking government why it is taking us forever to get out oil out of the ground," she noted.
Therefore, Final Investment Decision (FID) by the end of 2017, and 'first oil' by 2020, must become a reality, Muloni emphasized.
Speaking on behalf of the joint venture partners, General Manager Total E&P Uganda, Adewale Fayemi explained that FEED studies will allow the joint venture partners to make a Final Investment Decision (FID) before the end of this year as per the contracts signed with government of Uganda.
"This is a milestone in the country's journey towards oil production by 2020. We are currently preparing a call for tender for enabling infrastructure design work which is expected to be awarded in May, 2017," Adewale told Oil in Uganda.
He further revealed that the FEED studies will however not include the kingfisher area operated by CNOOC-this is yet to be launched.
The enabling infrastructure are works required ahead of major engineering and construction work including local access, site preparation, fencing and similar tasks for which Ugandan companies are expected to be involved.
Exploration Area 1 and 2 will require at least one CPF located in Buliisa district and will have capacity to produce 200,000bpd. The second CPF will be located in the Kingfisher area and will capacity to produce 30,000bpd. In total, the country expects to produce 230,000 barrels of oil per day, out of which the refinery will require 30,000 barrels while the 200,000 barrels will be exported through the East African Crude Oil Pipeline.
Last month, the governments of Tanzania and Uganda launched the Front End Engineering Design (FEED) study for the East African Crude Oil Pipeline Project ( EACOP) which is expected to be completed after eight months.