Six bidders for $2.5b oil refinery shortlisted

KAMPALA: The Ministry of Energy and Mineral Development (MEMD) on Monday presented names of six firms or consortia shortlisted to bid for construction of the 60,000-barrels-per-day green field oil refinery.

The ministry in early October opened the bid process with Request for Qualification (RFQ) from “appropriately qualified” investors and a total of 75 firms took part.

The Permanent Secretary, Kabagambe Kaliisa, in statement said they were overwhelmed with the significant interests in the Project.

“The interest in the Project RFQ clearly demonstrate that the international community sees real economic and energy opportunities within Uganda’s borders and the broader region,” he noted.

The bidding process was closed in late November and six of eight consortia (association of companies) which submitted detailed Statement of Qualifications have been selected to receive the Request for Proposals (RFP).

The project has entered a second phase and evaluations are conducted by US-based consultancy, Taylor Dejongh.

 The six firms will be issued an RFP over the next 30 days and be required to submit a full proposal for the financing, development and operation of the project whose construction is scheduled for 2015.

 Energy minister, Irene Muloni said government was committed to an open and transparent process in the due process.

 “We look forward to working with our final partner to develop this refinery and further unlock Uganda’s vast energy resources.”

 The selected companies are a South Korean consortium led by SK Energy Company; Chinese consortium, led by Petroleum Pipeline Bureau; Japan's Marubeni Corporation, and Swiss-based Vitol Group SA.

 Others are Russia's RT Global Resources and London-listed Petrofac Ltd.

 The appropriate multinational consortia to lead the $2.5billion project will be announced next year.

The project will be developed in a Public-private-Partnership (PPP) of 40:60 venture. Other East Africa countries are expected to each buy-up a 10 percent stake and so far Rwanda and Kenya have forward commitment.

 A total of 29 square kilometers needed for the refinery plant have been mapped in 13 villages in Kabaale Parish and the compensation of 7,118 people affected is ongoing in Hoima district.

 Meanwhile, France’ Total E&P last week submitted its first Filed Development Plan (FDP) which details how the company expects to start production. Other companies, China’ Cnooc has a production licence for Kingfisher field and UK’ Tullow is yet to acquire one.

 Side bar

Production of oil from the Kingfisher field is expected to start in between 2017-2018.

Government expects to expand the refinery to 120,000-150,000 by 2020-2022.