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Albertine Graben consortium signs deal to build $4bn oil refinery in Uganda

EBR Staff Writer Published 13 April 2018

The Uganda Government has signed an agreement with Albertine Graben Refinery Consortium (AGRC) to build and operate a $4bn oil refinery in the country’s Hoima district.

AGRC comprises Yaatra Africa; Lionworks Group; Nuovo Pignone International SRL, unit of General Electric Company; and Saipem.

Uganda President Yoweri Museveni said: “This agreement is a key step towards the construction of the oil refinery in Hoima District.

“Since it ensures development, design, financing, construction, operation and maintenance of the facility.”

As per the deal, the consortium will develop, design, finance, construct, and operate the refinery. The agreement also has provision for maintenance of the refinery.

Uganda National Oil Company CEO Josephine Wapakabulo said: “Today’s signing ceremony, and this project in particular, are a ‘game changer’ for the country and for UNOC.

“The development of the refinery will trigger a number of other investments in the energy-based industries and thus contribute to economic development of Uganda and will contribute to the achievement of middle-income status.”

The refinery, which will be a joint venture with the Ministry of Energy and Mineral Development and government-owned limited liability oil company Uganda National Oil Company (UNOC), will have 60,000 barrels-per-day of processing capacity.

With the deal signed, AGC will commence pre-final investment decision (FID) activities such as front end engineering and design (FEED); project, capital and investment costs estimation (PCE); environmental and social impact assessments (ESIA).

AGRC, however, will be responsible for funding the pre-FID activities.

The refinery, which will focus on processing crude oil sourced from Uganda, will be implemented entirely by a Special Purpose Company, the Refinery Company.

The Refinery Company will be incorporated by the private investors and the Uganda Refinery Holding Company, a unit of the Uganda National Oil Company.

According to estimates, Uganda has 6.5 billion barrels of oil deposits with recoverable reserves of 1.4-1.7 billion barrels.

Image: Officials and representatives during agreement signing for refinery development in Uganda. Photo: courtesy of African Development Bank Group.