Uganda gets closer to oil pro­duc­tion

East African Business Week - - FRONT PAGE - BY PAUL TENTENA

KAM­PALA, UGANDA- The three joint ven­ture part­ners of To­tal, CNOOC and Tul­low oil last week launched the Front End Engi­neer­ing De­sign (FEED) stud­ies for Uganda’s Oil Ex­plo­ration Area 1 and Ex­plo­ration Area 2 putting a land mark sign that the coun­try may pro­duce oil soon.

The joint part­ners have se­lected three in­ter­na­tional com­pa­nies of Fluor from USA part­ner­ing with China Petroleum Engi­neer­ing and Con­struc­tion Cor­po­ra­tion of China, Tech­nip of France and Chicago Bridge and Iron Com­pany based in the United States of Amer­ica through a com­pet­i­tive bid­ding process to con­duct the FEED. Uganda’s En­ergy Min­is­ter Irene Mu­loni as­sured the coun­try that its near­ing oil pro­duc­tion with the first drop ex­pected in 2020. “”We’re ex­pect­ing the FEED re­port by 31 De­cem­ber this year. Then, there we shall have the Fi­nal In­vest­ment De­ci­sion from the joint ven­ture part­ners,” said Mu­loni. Dur­ing FEED, all nec­es­sary tech­ni­cal def­i­ni­tion, cost and schedule es­ti­mates will be de­vel­oped to al­low the Joint Ven­ture part­ners to make a rec­om­men­da­tion for a Fi­nal In­vest­ment De­ci­sion. Mu­loni said the se­lected com­pa­nies boast of in­valu­able ex­pe­ri­ence in the de­sign and con­struc­tion of re­mote on­shore projects else­where in the world, and will bring dif­fer­ent engi­neer­ing de­sign philoso­phies and ex­per­tise for the ben­e­fit of the project. “The three se­lected FEED con­trac­tors have the po­ten­tial to progress to the next phase of the project, which is Engi­neer­ing, Pro­cure­ment and Con­struc­tion. “As the con­trac­tual strat­egy cho­sen is a com­pet­i­tive FEED, af­ter 6months of ini­tial de­sign the two best per­form­ing com­pa­nies on the FEED con­tract shall be in­vited to com­pete for EPC,” said Mu­loni. She said the re­sults from the FEED stud­ies shall pro­vide the nec- es­sary in­for­ma­tion to fine tune the cost es­ti­mate of the project, iden­tify the spe­cific tech­ni­cal ex­per­tise, skills and equip­ment needed for con­struc­tion. “As the FEED re­quires a large num­ber of en­gi­neers from many dif­fer­ent dis­ci­plines with first hand ex­pe­ri­ences of sim­i­lar projects else­where in the world, the first phase of the FEED study will be car­ried pri­mar­ily in the re­spec­tive of­fices of Flour, Tech­nip and CB&I. “How­ever, na­tional con­tent be­ing a pri­or­ity both for Gov­ern­ment of Uganda and the up­stream part­ners, a key de­liv­er­able from each con­trac­tor will be to pro­pose a Na­tional Con­tent strat­egy for the sec­ond phase. “This will be one of the per­for­mance cri­te­ria for se­lec­tion of the con­trac­tor for phase 2 of the FEED and even­tual se­lec­tion of the EPC con­trac­tor,” said Mu­loni. Mu­loni said a call for ten­der is be­ing pre­pared for en­abling in­fra­struc­ture de­sign work, ex­pected to be awarded in May 2017. “En­abling in­fra­struc­ture are the works re­quired ahead of any ma­jor engi­neer­ing and con­struc­tion work, in­clud­ing lo­cal ac­cess, bush clear­ing, site prepa­ra­tion, fenc­ing and other tasks of a sim­i­lar na­ture, for which Ugan­dan com­pa­nies are ex­pected to be in­volved,” said Mu­loni. She said con­cur­rent with the FEED stud­ies, other ac­tiv­i­ties whose con­tracts have also al­ready been awarded and are in progress with in the up­stream project in­clude En­vi­ron­ment and So­cial Im­pact As­sess­ment and Land Ac­qui­si­tion and Resettlement Plan­ning. “Work is also pro­gress­ing on the con­tract strat­egy for Drilling and Wells ser­vices,” she said. Mu­loni said con­tract­ing plans and im­ple­men­ta­tion ac­tiv­i­ties for the King­fisher Up­stream De­vel­op­ment and the East African Crude Oil Pipe­line are pro­gress­ing.

Uganda’s En­ergy Min­is­ter Irene Mu­loni as­sured the coun­try that its near­ing oil pro­duc­tion with the first drop ex­pected in 2020.

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