Uganda picks Russian-led consortium to build $2.5bn oil refinery - report

By bne IntelliNews February 17, 2015

Uganda has selected a consortium led by RT Global Resources, a subsidiary of Russia’s state-owned hi-tech corporation Rostec, to build and operate its first crude oil refinery, estimated to cost some $2.5bn, Daily Monitor, the country’s largest independent daily, reported, quoting sources from the energy ministry. The ministry is expected to make an official announcement later today.

The Rostec-consortium includes also Russian oil and gas company Tatneft, VTB Capital, the investment banking unit of sanctions-hit Russian state-controlled VTB Bank, and South Korean conglomerate GS Group. The only other bidder that reached the final stage of negotiations was a consortium led by SK Energy, part of South Korea’s conglomerate SK Group.

The winning consortium will finance 60% of the project costs, which include also the construction of a 205km product pipeline to Uganda’s capital Kampala and the necessary infrastructure, while the government will provide the balance. Hence, the predominantly Russian consortium will own 60% of the refinery, which is planned to be launched with a capacity of 30,000 barrels per day (bpd) by 2018. The capacity is set to be increased to 60,000bpd before 2020. The refinery will produce liquefied petroleum gas, diesel, petrol, kerosene, jet fuel, and heavy fuel oil.

Uganda’s petroleum products consumption stands currently at around 27,000bpd and is growing at an annual rate of about 7%. In East Africa, there is only one oil refinery, based in Kenya’s port Mombasa, which exports fuel to the region’s land-locked countries.

Uganda’s first oil field was discovered in 2006 and the country has estimated oil reserves of some 6.5bn barrels. Commercial production is expected to start in 2017 or 2018. The fields are developed by Tullow Oil, Total and China National Offshore Oil Corporation (CNOOC).

Related Articles

AB InBev sells 54.5% stake in African Coke bottling business for $3.15bn

Anheuser-Busch InBev will sell a 54.5% stake in Africa's largest Coke bottler to Coca-Cola Company for $3.15bn, the two companies said in a joint statement on December 21. The deal is expected to ... more

IMF slashes South Africa’s 2016 growth outlook to 0.7%

The International Monetary Fund (IMF) has lowered sharply its 2016 GDP growth forecast for South Africa to just 0.7% from 1.3% anticipated in October, its World Economic Outlook (WEO) update released ... more

MTN Nigerian fine raised back to $5.2bn, court refuses to freeze company bank accounts

The record fine, imposed on South Africa-based telecoms group MTN by the Nigerian Communications Commission (NCC) has been raised back to $5.2bn, publications in local media revealed. The ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss