The General Electric Co.-led group picked to build a $3.5 billion refinery in Uganda is close to making a final investment decision for the project, according to the country’s Ministry of Energy and Mineral Development.
The decision requires the start of work on the infrastructure connected to the plant, such as a refined products pipeline, according to a budget policy document. The government will hold a 40% stake in the project.
The ministry is seeking government funding of 100 billion shillings ($27 million) in the 12 months through June 2021 for that associated infrastructure. The plant, which will be able to process 60,000 barrels-a-day, will initially operate at about half of that capacity.
Uganda, East Africa’s third-largest economy, discovered commercially viable oil deposits in 2006 and plans to start production in 2022-23. The refinery will process crude from fields jointly owned by France’s Total SA, Cnooc Ltd. of China and London-based Tullow Oil Plc.
The Albertine Graben Refinery Consortium — led by Boston-based GE and including Italy’s Saipem SpA — won the deal to develop the refinery in Uganda’s Hoima district in April 2018. The group started front-end engineering design last March that was expected to last for about 15 months, according to the budget document.
AGRC will own 60% of the facility, while the government will have the option selling some of its stakes to other East African Community states and institutional investors.