Why Uganda picked UAE firm to refuel its oil refinery project.

A general view of TotalEnergies’ central processing facility construction in Buliisa, Uganda on February 20, 2023. PHOTO | AFP

In picking a United Arab Emirates (UAE) firm as the lead developer and investor for its 60,000-barrels-per-day oil refinery, Uganda has yet again opted for an outlier with the financial muscle but no technical expertise or footprint in the development of downstream refining facilities for oil and gas.

January 23, Energy Minister Ruth Nankabirwa announced that the government had picked Alpha MBM Investments Llc from the UAE, with which Kampala signed a Memorandum of Understanding on December 22, 2023, outlining co-operation and negotiation terms for the refinery.

Already set back several years, Kampala is keen on the quick take-off of the project that has since 2015 seen three investors — Russia’s RT Resources, South Korea’s SK Engineering, and the Albertine Graben Energy Consortium (Agec) — invited for the job but this did not go beyond the initial talks.

Read: Uganda in talks with UAE firm over $4bn oil refinery

The first two pulled out of the talks to develop the $4.5 billion refinery, while the US firms led Agec group failed to deliver key project targets and financing, despite holding on to the project framework agreement for six years since 2018.

In a media briefing, Ms Nankabirwa also hinted that the refinery project lost time after the Yaatra Africa, Baker Hughes and Saipem SpA consortium failed to make headway, requiring that the new investor hit the ground running to catch up with the upstream projects whose development is now advanced.

Invest or Donate towards HICGI New Agency Global Media Establishment – Watch video here