Uganda has urged local construction companies to build capacity in a bid to reap from the 15-20 billion U.S. dollars investment that will be generated by the development of the oil and gas sector over the next three years.
Monica Azuba Ntege, minister of works and transport, in a statement issued here on Monday by the Petroleum Authority of Uganda (PAU), said engineers should be prepared to tap into the upcoming construction phase by international oil companies.
The minister said civil works and provision of available construction materials are ring-fenced for Ugandans.
She was speaking at a meeting called to sensitize engineers and building contractors about the opportunities in the oil and gas sector.
The meeting organized by PAU in partnership with other government agencies, was part of efforts to prepare local firms for the development phase of the oil and gas sector with planned construction of the East African Crude Oil Pipeline (EACOP), oil refinery, among others. EACOP will run from the oil fields in western Uganda to the Tanzanian seaport of Tanga.
Ntege urged professionals, contractors, manufacturers and suppliers with the necessary competencies and capacity to extend their sphere of influence and explore the opportunities.
Ernest Rubondo, Executive Director of PAU, said experience from oil producing countries across the world shows that for the oil and gas sector to spur inclusive growth, deliberate efforts have to be made to enable the benefits from the sector reach the wider population.
Rubondo said this can only be achieved through growing the participation of Ugandans and Ugandan entities in the provision of goods and services to the sector.
"The construction and engineering subsector of the economy is one of the areas which has a very significant potential to benefit from the development of the country's oil and gas sector. This is especially so because the construction and engineering subsector provides opportunities for high value participation of Uganda entities," he said.
He said potential local suppliers will be empowered with knowledge on the construction and engineering requirements for the oil and gas sector in terms of quantities, scope, timelines and standards.
Robert Kasande, permanent secretary ministry of energy and mineral development, said local companies need to comply with the required standards or risk missing out on the opportunities once the Final Investment Decision (FID) is taken. FID is the detailed plan which an oil company will follow to develop an oil field.
"FID will surely be taken. It may be tomorrow or the other day but whatever time it comes, we should prepare and ensure that whatever you take from here, you put into practice. That way, when time for bidding comes, you are ready to participate," Kasande said.
Andrew Kasekende, a Director at ICS Engineering and Environment Limited, which is working with United Kingdom-based Worley on the Resettlement Action Plan for the EACOP, said there are several challenges that hinder local companies from getting contracts.
"From experience, the major challenges faced by local companies are lack of awareness of oil and gas standards, high cost of capital, and business uncertainty after investment," he said.
Brian Tahinduka, an official from Stanbic Bank Uganda Limited, said the bank is ready to fund up to 54 million dollars for a single project.
"As long as you have the capacity and capability, we have the money. We are the only institution with a unique triple A rated mark in Africa for such huge projects," he said.
Uganda expects to start commercial production of oil by 2022. Ministry of energy and mineral development figures show that the country has so far discovered over 6.5 billion barrels of oil.
Three international companies, China National Offshore Oil Corporation, Total and Tullow have an equal stake in Uganda's so far discovered oil wells in the Albertine Graben, in the western part of the country.
Editor:Cherie
