Search This Blog

Thursday, 3 July 2014

Uganda selects final bidders for local refinery

Uganda last week made progress towards selecting a contractor for its oil refinery and picking a consultant for its portion of the 2,935km standard gauge railway (SGR) that will run from Mombasa in Kenya to Kigali in Rwanda.
As the Energy Ministry announced the final round of bidders for the refinery on June 24, the Works Ministries from Uganda and Rwanda hired Gauff Ingenieure, a German engineering consultancy firm, to carry out design studies for the Kampala-Kigali stretch of the SGR.
The ministries expect Gauff to submit its findings and recommendations in 12 months. On its part, the Energy Ministry hopes to announce the successful refinery bidder before the end of this year.
The SK Group-led consortium from South Korea and the RT Global Resources-led consortium from Russia beat Marubeni Corporation from Japan and China Pipeline Petroleum Bureau.
Marubeni lacked a bid bond as required by the request for proposals (RFP), and China Pipeline did not adequately satisfy all the requirements of the RFP, noted the statement from the Ministry of Energy and Mineral Development.
Both the railway and the refinery projects are required to start by 2018. The projects face potential delays and could be derailed by outstanding compensation claims from people being displaced.
Kenya has started construction of its section of the SGR. Work on the railway is however moving slowly because land acquisition and compensation have not been finalised.
The government requires land inside Tsavo National Park, close to the capital Nairobi, and along the road to Tororo, much of it privately owned.
Uganda is not having it easy with land acquisition either. The government had planned to complete payment for the 7,118 people that the refinery will displace by June this year in time for the announcement of the successful refinery bidders.
To date, it has only paid half and expects to cover the rest by September 2014, at a cost of Ush35 billion ($13.2 million).
Civil society organisations working in the oil and gas sector have expressed doubt over the feasibility of the timeline and amount of money earmarked. This is especially so in regard to over 100 households who rejected the government’s assessment of their land and the property on it, and the 96 households who chose to be resettled.
“The government may be able to credit the accounts of those waiting for compensation money in the next three months, but saying they will resettle families within three months is a lie and insensitive,” said Winnie Ngabiirwe, who heads Global Rights Alert, one of the leading NGOs in natural resource governance in Uganda.
“There is no evidence to show that the government has already bought the land on which to resettle people. We have not seen the government calling for tenders for construction of houses, schools or churches in the resettlement areas. Are they going to resettle them in hotels or tents?” Ms Ngabiirwe asked.
She said the government is breeding fear and anxiety when it gives such short timelines.
Several organisations, including the Uganda Human Rights Commission and the Inter-Religious Council of Uganda, have criticised the government over the way it has handled the people it is displacing for the refinery.
Analysts have condemned it as unfair and unconstitutional. They say it is a source of present and future unrest in the affected communities.
“There is a need for openness on the part of the government so that these fears and anxieties are addressed. I am glad the government is progressing with development in the oil sector. However, let this development not come at the expense of lost livelihoods, missed opportunities and human-rights violations,” Ms Ngabiirwe added

Source: The East African