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Uganda: Kenya Shrugs Off Uganda Plan to Build Oil Pipeline Via Tanzania

Nairobi — Kenya has shrugged off fears over a decision by neighbouring Uganda to consider building a crude oil pipeline through Tanzania. Kenya brushed aside concerns that Uganda’s plan, if it proves cheaper than the alternatives, would scuttle its infrastructural plans for its own oil pipeline. Acting Transport Cabinet Secretary James Macharia told the Nation on Wednesday that while Kenya is "keenly keeping a close watch on the unfolding events in Uganda", it would go ahead with its own infrastructural plans "undeterred". "We are going according to our own plans. Nothing has changed," said Mr Macharia in Nairobi. Last month, it emerged that Kenya’s prospects of a crude oil pipeline through Hoima-Lokichar-Lamu could be crushed after Uganda signed an agreement with Tanzania to explore the Tanga route. Uganda, Tanzania, the Tanzania Petroleum Development Corporation and Total E&P Uganda signed a memorandum of understanding (MoU) outlining new pipeline arrangements. The […]

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Kenya Starts Talks With Uganda on Financing for Oil Pipeline

Kenya started talks with neighboring Uganda on the financing and construction of an oil pipeline that will link the two countries and ferry crude produced by companies including Tullow Oil Plc, the Kenyan Energy Ministry said. Discussions that also looked at project time frames and involved officials from both East African countries began this week, Joseph Njoroge, the ministry’s principal secretary, said in a phone interview from Nairobi, Kenya’s capital, on Wednesday. The negotiations follow an announcement by Kenyan President Uhuru Kenyatta on Aug. 10 that the route for the conduit had been agreed after months of debate. “We have started working out the details together with the Ugandans,” Njoroge said. “We will also engage as many stakeholders as we can. We want this project to take off immediately.” Tullow has found oil in both countries, with Uganda estimating finds at 6.5 billion barrels and Kenya at 600 million […]

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Kenyan Oil-Pipeline Accord With Uganda Paves Way for Exports

Kenya and neighboring Uganda agreed on the route of a planned oil pipeline, ending months of debate on the link that will export crude from companies including Tullow Oil Plc. The pipeline will pass through the Lokichar basin in northern Kenya, Manoah Esipisu, spokesman for Kenyan President Uhuru Kenyatta, said Monday by phone from the Ugandan capital, Kampala. The countries had also discussed building the link through southern Kenya and the capital, Nairobi. The agreed design will be the cheapest to develop, according to an e-mailed statement from the Ugandan presidency. Tullow has found oil in both countries, with Uganda estimating finds at 6.5 billion barrels and Kenya at 600 million barrels . The planned $4.5 billion pipeline to the Indian Ocean will allow the U.K. company to start exports from joint ventures with Africa Oil Corp. and Total SA. China’s Cnooc Ltd. is also a partner in Uganda. […]

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Uganda: Country Fails to Lure Majors Into Oil Industry

Last week, the ministry of Energy and Mineral Development released a list of 19 multinational companies that expressed interest in taking up licenses to explore for oil in the Albertine graben. However, the list reveals one glaring reality: Uganda has failed to attract a major company into its oil industry. By most measures, all the companies that have expressed interest are what one would call junior firms, which are more willing to take risks with exploring for oil in wildcat wells. Many of the firms are from Nigeria, South Africa, United Arab Emirates (EAE), and USA. Petroleum directorate officials had said global oil companies such as Exxon Mobil and Shell had shown interest in coming to Uganda, after it had been de-risked with success stories from companies such as Heritage Oil and Tullow Oil. Releasing the list of companies on Wednesday, the permanent secretary in the ministry of Energy, […]

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Tullow Oil to Settle Uganda Tax Dispute for $250 Million

Tullow Oil Plc settled a capital gains tax dispute with the government of Uganda after agreeing to pay $250 million related to a 2012 deal with Total SA and Cnooc Ltd. The company paid $142 million at the time and will pay the remaining $108 million in three equal installments, it said Monday in a statement. The first $36 million portion has already been paid with remainder due in 2016 and 2017, it said. Significant output of oil in Uganda, first discovered there in 2006, has been restrained by delays including wrangling between the East African country and companies about how much crude to process locally or export through a pipeline. Uganda has an estimated 3.5 billion barrels of crude, according to the Energy Ministry, with Tullow, Total and Cnooc planning to tap the Lake Albert fields. “In recent months, the government of Uganda has proposed welcome and necessary […]

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Uganda: Refinery Will Take Five Years to Complete

Repairs to the railway network operated by RVR in Kenya and Tanzania. Transport infrastructure remains a challenge as Uganda readies itself for oil production. Uganda’s planned crude oil refinery will take five years to complete, a representative of the firm that won the bid to build the multi-billion 60,000 barrels per day facility has revealed. Andrey Kozenyashev, the Regional Representative of RT Global Resources in East Africa told an industry meeting convened by the Uganda Chamber of Mines and Petroleum in Kampala yesterday that the company anticipates to complete the project in 2020 at the earliest. "After signing the agreement, it will take one and a half years to do the designs and then three years for construction of the facility," Kozenyashev said. The RT-Global Resources-led consortium beat off a challenge from another consortium led by South Korea’s SK Group to win the $2.5 billion project that will involve […]

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Uganda not yet ready for oil prime time

Bank of Uganda says oil prices are too low to realize nation’s full oil potential and production targets. Photo courtesy Tullow Oil KAMPALA, Uganda, April 22 (UPI) — A weakened crude oil market means investments might not materialize in time to finance Uganda’s fledgling oil sector, the Bank of Uganda said. The Bank of Uganda said in a monetary policy report for April there are lingering questions over the nation’s oil development given the low price of oil and the investments needed to exploit the type of crude oil found in the country. "Whereas oil production had been projected to start in 2018, this date could now be pushed out even further, given that the profitability of oil investments could remain depressed in the foreseeable future," the report said. Crude oil prices are trading at around 40 percent below their June 2014 highs, forcing energy companies to spend less […]

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Uganda: Sanctions-Hit Russian Group Wins U.S. $4 Billion Uganda Oil Refinery Deal

Uganda has rewarded a $4bn oil refinery deal to a subsidiary of Russia’s Rostec, whose CEO has been subject to US sanctions. Uganda and RT Global Resources will now negotiate the terms of a joint venture to engineer and finance the $2.5bn refinery plus a product pipeline and associated infrastructure. The decision to award the contract cements growing ties between Moscow, and the country, which increasingly characterises the west as a neo-colonial aggressor. The CEO, Sergei Chemezov, is a former KGB officer and close ally of President Vladimir Putin. The US blocked his assets and prohibited companies from dealing with him since April 2014 in response to Russia’s military involvement in the conflict in eastern Ukraine. The EU followed suit in September. Although Uganda is under no legal compulsion to comply with the sanctions, the decision will further threaten its international standing. Uganda’s global standing was knocked last year […]

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Uganda: Why Govt Picked Russian Firm for Oil Refinery

Photo: Amnesty International (file photo). Government yesterday picked a Russian-led international consortium led by RT Global Resources as the preferred bidder for the construction of the country’s oil refinery. The other company which lost out, SK Engineering and Construction Co. Ltd from the Republic of South Korea, was retained as the alternative preferred bidder. RT Global Resources is a subsidiary of Rostec, a Russian arms manufacturer. Members of the consortium include; VTB, Capital Plc, a subsidiary of VTB, the second largest Russian state-owned bank, Telconet Capital Ltd Partnership, Tatneft JSC and GS Engineering Construction Corporation (South Korea). While members of the SK Engineering and Construction-led consortium include: SK KDB Global Investment Partnership, a private equity fund, China State Construction Engineering Corporation Ltd, Haldor Topsoe A/S and Mastro Oil and Gas Solutions (MOGAS). The selection of a preferred bidder for the refinery follows the submission of final offers from the […]

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Uganda, Kenya to Build World's Longest Heated Oil Pipeline

Should Uganda and Kenya finally build a crude oil export pipeline, it will be the longest heated such facility in the world. According to a report released last month by Tullow Oil Plc, both countries have agreed to build the pipeline and have commenced a comprehensive study on the pipeline. "Tullow and its partners have agreed with the government of Kenya to commence development studies. In addition, the partnership is involved in a comprehensive study for an export pipeline," the Tullow Oil Plc annual report 2013 reads. According to the report, the export pipeline route on the Kenyan side is expected to run mostly underground, over 850 kilometres from the Lokichar basin to the coast. Kenya is to construct the pipeline from Lokichar basin while Uganda is expected to construct its part of the pipeline from the Lake Albert rift basin to link up with the Kenyan pipeline and […]

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Uganda, Kenya to Build World’s Longest Heated Oil Pipeline

Should Uganda and Kenya finally build a crude oil export pipeline, it will be the longest heated such facility in the world. According to a report released last month by Tullow Oil Plc, both countries have agreed to build the pipeline and have commenced a comprehensive study on the pipeline. "Tullow and its partners have agreed with the government of Kenya to commence development studies. In addition, the partnership is involved in a comprehensive study for an export pipeline," the Tullow Oil Plc annual report 2013 reads. According to the report, the export pipeline route on the Kenyan side is expected to run mostly underground, over 850 kilometres from the Lokichar basin to the coast. Kenya is to construct the pipeline from Lokichar basin while Uganda is expected to construct its part of the pipeline from the Lake Albert rift basin to link up with the Kenyan pipeline and […]

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Tullow May Sell Part of Stake in Ugandan Oil Field

Africa-focused oil and gas explorer Tullow Oil PLC is considering selling part of its stake in a Ugandan oil field it is developing with France’s Total SA and China’s Cnooc Ltd. to focus on Kenya, where a more supportive government is helping a project there move faster, Tullow’s chief operating officer said Wednesday. It is the first time the company has disclosed it could look to sell a share in one of its prized assets. The project has been delayed for years and has weighed on the share price while the company and its partners hammered out a development plan with the Ugandan government. Tullow and partners struck an agreement with the Ugandan government on a development plan for the Lake Albert basin last month after years of talks. But in the meantime, a project to develop Kenya’s South Lockichar basin, which was discovered in 2012—five years after the […]

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Uganda takes major steps with oil majors

Ugandan Energy Minister Irene Muloni said Thursday signing agreements with international oil companies gives the country significant production opportunities. Muloni said Uganda is close to becoming a major oil producer with the signing of memorandums of understanding with Chinese, French and British oil companies. "The signing of the MOU is therefore a significant step toward the production of Uganda’s discovered oil and gas resources," she was quoted by the Ugandan newspaper the Independent as saying. Tullow Oil, a British exploration company involved in the agreements, published a report last year on its Ugandan developments. It said it has uncovered more than 1 billion barrels of oil in Uganda since operations began and most of that was in the country’s Lake Albert basin. Muloni said the agreements gives Uganda a "harmonized commercialization plan for the development" of its oil resources. She said the government […]

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Uganda Signs Deal With Foreign Companies to Develop Oil Sector

The government of Uganda has signed a long awaited deal with foreign oil companies to develop its oil sector, bringing to an end several years of protracted talks and opening the way for the development of the country’s crude oil reserves. The deal is based on a Memorandum of Understanding with U.K.’s Tullow Oil PLC, France’s Total SA and China’s Cnooc Ltd. cooperating on plans to develop the country’s oil sector. Those plans include a 60,000 barrels-a-day oil refinery, an oil export pipeline to Kenya’s northern port of Lamu and a crude-fired electricity plant in Uganda’s oil region, Irene Muloni, Uganda’s energy and minerals minister, told reporters in Kampala Thursday. The agreement between the energy multinationals and the Ugandan government could result in up to $15 billion to $17 billion in new investment, company officials said. The new investment will go toward the development of up to 20 […]

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Uganda Agrees on Deal to Develop Oil Sector

The government of Uganda has reached a deal with foreign oil companies to develop its oil industry, the country’s energy and minerals minister said Friday, ending a nearly three-year impasse and opening the way for a $15 billion investment. The government has agreed the terms of a Memorandum of Understanding with U.K.’s Tullow Oil PLC, France’s Total SA and China’s Cnooc Ltd. for the commercialization of the oil sector. The plans consists of a 60,000 barrels-day refinery, a crude export pipeline to Kenya’s northern port of Lamu and a crude-fired electricity plant in Uganda’s oil region, Irene Muloni said in a statement obtained by The Wall Street Journal Friday. The development paves way for a multibillion-dollar investment to develop the country’s oil fields, which are believed to contain up to 3.5 billion barrels of crude. Uganda contains sub-Sahara Africa’s fourth-largest amount of oil reserves, behind South Sudan, Angola […]

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Kenya, Uganda Scramble to Bring Peace to South Sudan

Kenya and Uganda were recruiting investors to back an oil pipeline in South Sudan in December when a rebellion upended the world’s newest nation. Now the two East African nations have joined a diplomatic effort to end the conflict in South Sudan —yet another reminder of how the security crises of a volatile region intrude on efforts to boost commerce among its countries. "I’m not sleeping," Ugandan President Yoweri Museveni said in a televised address last week. "I am monitoring the crisis which is taking place in the young country of South Sudan and I want to see that peace is attained there." More than 1,000 people have died and more than 100,000 have fled their homes since troops loyal to former Vice President Riek Machar rose up in December against those loyal to President Salva Kiir . On Tuesday, South Sudanese military spokesman Philip Aguer said government troops […]

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Talks Don’t Halt South Sudan Conflict

South Sudan’s warring parties began talks Friday with mediators in Ethiopia, as both sides ignored calls for a cease-fire. Negotiators met separately with representatives from the regional trade block, known as the Inter-Governmental Authority on Development, or IGAD in Addis Ababa. These preliminary talks aim to narrow differences that have led to clashes killing more than 1,000 people and displacing nearly 200,000. The mediators hope both sides of the conflict can hold direct talks on Saturday, according to a spokesman for Ethiopia’s foreign ministry, Dina Mufti. The modest beginning marks a breakthrough for African-led efforts to end more than two weeks of fighting in the world’s youngest nation. The conflict—which pits the country’s President Salva Kiir, against his former deputy, Riek Machar —threatens to render South Sudan along ethnic lines and upend its oil industry. Energy exports account for nearly all of South Sudan’s exports and foreign revenue. […]

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Talks Don't Halt South Sudan Conflict

South Sudan’s warring parties began talks Friday with mediators in Ethiopia, as both sides ignored calls for a cease-fire. Negotiators met separately with representatives from the regional trade block, known as the Inter-Governmental Authority on Development, or IGAD in Addis Ababa. These preliminary talks aim to narrow differences that have led to clashes killing more than 1,000 people and displacing nearly 200,000. The mediators hope both sides of the conflict can hold direct talks on Saturday, according to a spokesman for Ethiopia’s foreign ministry, Dina Mufti. The modest beginning marks a breakthrough for African-led efforts to end more than two weeks of fighting in the world’s youngest nation. The conflict—which pits the country’s President Salva Kiir, against his former deputy, Riek Machar —threatens to render South Sudan along ethnic lines and upend its oil industry. Energy exports account for nearly all of South Sudan’s exports and foreign revenue. […]

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Oil flowing again from Yemeni pipeline damaged by saboteurs

Repairs were made and oil was flowing again from a pipeline damaged by saboteurs in Yemen’s central Marib province, a provincial leader said. Ali al-Fatimi said Sunday engineers managed to repair damage to the line, which was attacked last week. Oil deliveries though the pipeline resumed at an undisclosed rate, the official Saba News Agency reported. Saba said the pipeline was "attacked by saboteurs" but didn’t indicate who was responsible. The Marib provincial leader said local officials and citizens had been able to provide security following the the attack. Yemen is struggling to control violence amid threats from al-Qaida, southern separatists and northern Shiite rebels. Energy company Yemen LNG said its facilities at the Balhaf export terminal were attacked by unnamed saboteurs in December. Al-Qaida took credit for a December attack on the Yemeni Defense Ministry. Pastor prays for ‘plantation called New York […]

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Uganda Receives 10 Oil-Output Applications for Albertine Graben

Uganda , the country with sub-Saharan Africa’s fourth-largest oil reserves, received 10 production applications for 21 discoveries in the Albertine Graben region as the nation moves closer to starting output in 2017. Tullow Oil Plc, Total SA, and China National Offshore Oil Corp. all sought licenses, according to a statement today on the website of Uganda’s Petroleum Exploration and Production Department in Entebbe near the capital, Kampala. The government is in talks with Tullow about its eight applications, CNOOC got its first license in September, and Total’s request was made in December, the notice shows. Total may submit five more applications this year in Exploration Area 1, and one for EA 1A, according to the statement. Tullow has until the end of April to appraise the Waraga discovery in Exploration Area 2, where it is the operator, and is also drilling at Waraga-3, a second appraisal well, the department […]

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Wood Mac: Uganda-Kenya pipeline vital for region

A proposed oil pipeline from central Uganda to the coast of Kenya could be a vital step toward unlocking East Africa’s potential, Wood Mackenzie said Wednesday. "There is huge untapped potential across both countries, with over 3.5 billion barrels of [expected] volumes in Kenya, and a further 1 billion barrels of [expected] reserves in Uganda," Martin Kelly, an African analyst for energy consultant Wood Mackenzie, said in a statement. "The proposed pipeline is fundamental in unlocking value for both countries." Wood Mackenzie estimates it will cost at least $4 billion to build an 869-mile long pipeline from central Uganda to the Kenyan coast. Uganda is a landlocked country and the region in general lacks the infrastructure needed to take full advantage of the oil potential. Wood Mackenzie adds the type of oil found in Uganda needs to be heated in order to facilitate pipeline […]

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Tullow Oil says ‘Uganda’s time has come.’

British energy explorer Tullow Oil said it was ready to take “decisive action” to exploit the resource potential in Uganda. “Uganda’s time has come [and the country] is fast becoming a prominent potential player in the world’s energy market,” Jimmy Mugerwa, general manager of Tullow Oil Uganda, said in a statement Monday. “Decisive action is now required in order to maintain that advantage.” Tullow published a country report on Uganda, tracking progress since Tullow entered the country in 2004. Tullow said it invested $2.8 million on oil exploration in Uganda where discoveries have uncovered more than 1 billion barrels of oil. In June, the High Court in London ruled in favor of Tullow in a tax case with rival Heritage Oil related to operations in Uganda. Heritage in 2009 agreed to sell its Ugandan holdings to Italian energy company Eni. Tullow had the right […]

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Tullow Oil says 'Uganda's time has come.'

British energy explorer Tullow Oil said it was ready to take “decisive action” to exploit the resource potential in Uganda. “Uganda’s time has come [and the country] is fast becoming a prominent potential player in the world’s energy market,” Jimmy Mugerwa, general manager of Tullow Oil Uganda, said in a statement Monday. “Decisive action is now required in order to maintain that advantage.” Tullow published a country report on Uganda, tracking progress since Tullow entered the country in 2004. Tullow said it invested $2.8 million on oil exploration in Uganda where discoveries have uncovered more than 1 billion barrels of oil. In June, the High Court in London ruled in favor of Tullow in a tax case with rival Heritage Oil related to operations in Uganda. Heritage in 2009 agreed to sell its Ugandan holdings to Italian energy company Eni. Tullow had the right […]

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