Uganda Oil Infrastructure

Uganda Oil Infrastructure

oilUganda is focusing on investing in its oil and gas infrastructure. The investment worth over $1US billion this year, per a senior ministry official.

The government is expected to receive close to $20 US billion over the next three years as the joint venture with oil company partners. The joint venture will commercialize Uganda’s petroleum resources that were discovered over a decade ago.

The development of the upstream projects is being complied into three joint venture partners, CNOOC Uganda Ltd, Total E&P Uganda and Tullow Uganda Operations Pty Ltd.

The Minister of Energy and Mineral Development Irene Muloni stated recently the government expects a pick-up in activity in the sector in 2019 following a calm 2018, that involved designs of key production infrastructure such as the East African Crude Oil Pipeline and the two central processing facilities.

The government has changed its timeline for first oil by 24 months to 2022 following a series of missed deadlines.

According to the government’s original road map, first oil was schedule for 2020 but the joint venture oil companies failed to submit their final investment decisions by the deadline. Muloni mentioned the government had expected the key decisions to be made by the end of 2017 to early 2018 first quarter.

Unfortunately, it never happened by the end of 2018, the government announcement of the 2020 first oil timeline was to premature and many observers thought it was an ambitious schedule considering the range and cost of the infrastructure involved.

Oil companies needs to develop the infrastructure to product oil. Including drilling and completing more than 400 wells, setting up two central processing facilities, laying of over 20km of in-field flow lines, laying approximately 150km of pipelines, construction of base camps and minor access roads, among others.

Oil companies must do front end engineering designs before making their final investment decision for the two central processing facilities.

These include the Tilenga project which covers Buliisa and Nwoya districts and the Kingfisher project which covers Hoima and Kikuube districts—both estimated to cost about US$ 8 billion.

 

The Tilenga project will have a processing facility with capacity of up to 190,000 barrels of oil per day and the Kingfisher project, 40,000 barrels per day. These processing facilities will feed into the refinery and the 1,445 km crude oil pipeline.

There is much more to do before the first oil schedule, the government has given two years maximum before they can start the construction of the refinery. It is expected to be activity by 2023.

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