ALSF Weighs in on Uganda’s oil refinery project

In late July, Uganda chose a consortium, including General Electric Co., to build and operate a crude oil refinery, which will eventually process oil from fields being developed by Total SA and Tullow Oil Plc.

The African Legal Support facility (ALSF) is involved in the negotiations of the project’s framework agreement at the instance of the Ugandan authorities, following the selection of a consortium to develop the US$4 billion facility when negotiations with groups led by Russia’s RT Global Resources LLC and South Korea’s SK Engineering & Construction Co. were inconclusive. Thus, in view of the urgent need for legal counsel, due to previously-scheduled and fast-approaching negotiations, the Facility approved a grant for emergency technical support on 14 June 2017 to consolidate and enhance the process.

Staff of the ALSF will attend the first round of negotiations between the Ugandan Government and the selected Consortium, scheduled to take place from 21 to 25 August. These negotiations will hopefully produce a Project Framework Agreement with well-elaborated timelines and apportioned responsibilities.

Peter Muliisa of the Uganda National Oil Company explained: “The support which the ALSF has extended to Uganda in negotiations leading to the development of a refinery has been invaluable. The legal, commercial, and technical expertise provided has enriched the negotiation team and greatly enhanced the project implementation speed.”

The refinery, located in Hoima district in the Western region, is billed to double its crude processing capacity from 30,000 to 60,000 barrels per day. Beginning in 2020, the plant will be supplied by fields with over 6.5 billion barrels of crude, being exploited by Total, London-based Tullow and China’s Cnooc Ltd.