Irene Muloni, Uganda's Minister of Energy and Mineral Development

The long waited move will see a resumption of production activities in the Abertine Graben that had halted due to the expiry of Heritage Oil and Gas’s (which sold to Tullow) prospecting license and failure to apply for a production license.

The government and Tullow oil have signed the production sharing agreements for  kanywataba and pakwach basin oil wells  in Lake Albert rift Basin.

The oil production sharing agreements were signed by the minister of Energy and Mineral Development Irane Muloni on half of government and Tullow Oil Company General Counsel Graham Martin at the ministry of Energy and mineral Development.

Muloni said that in this new agreement Tullow will partner with Total and CNOOC  each having share holding of 33.3%to avoid monopoly of Tullow in oil Uganda’s production.

The move might not go well with some MPs and civil society organisations who had wanted the government to delay the signing of the oil production license until investigations into the oil sector are complete and a new oil and gas law is enacted.

Muloni however says that she will table the new oil and gas bill before parliament when it resumes its work next week so as oil laws are in place to apply them to open up competition in the oil industry.

Ultimate Media

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Download a PDF of the Foster wheeler Uganda Refinery study report here. 

The government of Uganda hired Swiss Engineering and Construction company Foster Wheeler Energy Limited (FWEL) in early 2011 to undertake a study of Uganda’s oil potential. The key goal of the assignment was to advise the government on whether to strategise on constructing a refinery or an oil pipeline to export crude oil.

According to the Ministry of Energy and Mineral Development, the study was is in line with the objective four of the National Oil and Gas Policy for Uganda of promoting valuable utilisation of the country’s resources.

The aim of the study, among other things, was to recommend the optimum size, configuration, location, cost and financing options of the refinery, the attendant infrastructure and market for the refined products, as well as preliminary environmental assessment of the possible impacts of refinery development.

Foster Wheeler successfully completed the study and presented a report to the Ministry of Energy and Mineral Development in August 2010.

It is by now no secret that the study recommended that it would be more viable for Uganda to build an oil refinery, with a 150 000-bl/d refinery facility in Uganda suggested.

The study followed pressure from many oil companies preferring Uganda to use the Kenyan refinery in Mombasa to process the oil from western Uganda.

Other than the technical benefits of avoiding transporting heated crude over such a long distance from western Uganda to Mombasa, the consultants pointed at the direct employment opportunities that will accrue from the refinery, saying it will boost Uganda’s economy by saving over $1bn annually.

The study report weighing the different options as well as the investment opportunities in either options is the key document on Uganda’s oil industry. No wonder the government is selling a copy of the report at more than $150,000 and you have to sign an agreement not to divulge the contents there in.

We bought a copy from a 3^rd party and are availing it to you so you can take more informed decision as regards Uganda oil sector and potential.

Download a PDF of the Foster wheeler Uganda Refinery study report here. 

You can also download

Uganda oil and Gas Laws-a Review

Uganda Production Sharing Agreement with oil companies-part I

Uganda Production Sharing Agreement with oil companies-part 2

The post Fosterwheeler Final report on Uganda oil Industry Refinery first appeared on Uganda Multimedia News & Information.

Onek is accused, together with Prime Minister Amama Mbabazi and foreign affairs minister Sam Kuteesa of taking bribes from oil companies.

The committee, chaired by Michael Werikhe said they could not proceed without documented presentations from Onek, who is the current minister of Internal Affairs.

Onek said he did not possess a written submission of his response to the legislators concerns and had failed to get some information from the ministry of energy.

He asked for more time up to Tuesday next week to ensure the needed information and documents are given to be able to present his case.

The issue of resignation also came up after Makindye West MP; Hussein Kyanjo questioned his refusal to step aside while the committee investigates the bribery claims as well as the Rules and Privileges which is handling the issue of contempt of Parliament on the part of the ministers.

Kyanjo expressed fear that the committee could be wasting time if it did not first get guidance from the Speaker on how to proceed.

Ultimate Media

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The Permanent Secretary in the Ministry of Energy and Mineral Development, Kabagambe Kalisa says that oil production has not started and will commence in 12-18months from 2012.

While appearing before the adhoc parliamentary committee on oil Tuesday morning, Kalisa said the government and oil companies are currently carrying out a testing program intended to understand how the oil will be produced.

He explained that while some oil has been extracted, it is being stored for testing and will sold later to cement factories and power generation firms.

The PS says the supply of crude oil to the companies will be the second phase in about a year and half, before the government embarks on the 3^rd phase of oil production with construction of a refinery being planned to start in three years.

He says the government is planning to start with a small refinery to produce about 200000 barrels of oil per day for the local market as the oil companies and government to develop capacity.

Kalisa says within 5years, the oil refinery will be able to produce 60000 barrels of oil per day which will be targeted at the regional market.

This, he said will be expanded to a production capacity of 12, 0000 barrels of oil per day in ten years when the country should start exporting oil on the global market.

Ultimate Media

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During a session with the committee, the minister of state for finance Aston Kajara and the minister of Energy Irene Muloni wanted to use the current budgetary allocation of 60 billion shillings to cover the arrears arising from the past expenses of fuel for the generation of thermal power by a number of firms.

The committee has however advised the ministers to drop their proposal because the arrears worth 92 billion shillings had not been reflected in the ministerial policy statement for the financial year 2011/12.

The ministry of energy has an outstanding debt of over 290 billion shillings owed to a number of thermal power firms such as Aggreko, Electromaxx, Eskom and Jacobsen among others.

The MPs argue that the committing of the money for current expenditure to clear off arrears has lots of legal implications, which they say they were not ready to get involved in.

The ministers have accepted the proposal of the Committee to drop their proposal and draft a new resolution to request for the funding to the tune of 92 billion shillings

Ultimate Media

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