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Refinery contractor to be announced in February 2015

The Government of Uganda has deferred awarding of the refinery contract to next year following requests by the bidders for more incentives.

Two consortia, one led by South Korea’s SK Group and the other by Russia’s RT-Global Resources, are vying for the $2.5 billion project.

According to Kabagambe Kaliisa, the Energy Ministry’s Permanent Secretary, the government has been negotiating with the two bidders and they now have up to 19th January next year to submit their final offers.

“The preliminary negotiations were necessary to give the bidders clarity on government’s expectations and also understand their position as investors before they submit their final offers.”

The final offers will document the bidders’ technical concept design for the refinery, project implementation and operating plans, national content policy and project management teams, among others. They will also detail their financial and long-term business plans and review the terms of the different Project Agreements proposed by government.

The winner is expected to be announced in February 2015.

The refinery project will be developed under a Public Private Partnership (PPP) with the lead investor taking a 60% stake and the government taking the remaining equity.

The project will involve development of a refinery and product storage facilities in Hoima, Western Uganda, as well as a 205 kilometre product pipeline to a terminal near the capital, Kampala.

Report by Flavia Nalubega

editor@oilinuganda