Ephriam Kasozi
3 May 2011
Government is in the process of establishing a requisite legal framework for the management of the oil and gas sector, a move aimed at providing a conducive investment climate.
State Minister for Mineral Development, Peter Lokeris said the process, which is at an advanced stage is set for moving to the next level of oil and gas development in the country that will include developing the discovered oil and gas fields and commercializing them through a refinery development.
Mr Lokeris made the remarks at the opening of the workshop convened to present results of the feasibility study on a refinery development in the country.
The study was completed at the end of 2010 and has been adopted by government.
“Government is considering phasing the development to start with a 20,000 barrels per day early refinery in the short term. This could be be upgraded to a 60,000 barrels per day refinery in the medium term, with further expansion to a 120,000 barrels per day in the long run,” Mr Lokeris said.
The minister revealed that government was looking forward to working with the private sector in the developing the oil and gas sector in Uganda.
Some analyts have previously argued against economic sense of constructing a refinery in Uganda.
According to Mr Robert Kasande, the Assistant Commissioner at the Ministry Energy and Mineral Development, a total of five options can be considered for wax inhibition.
“Heating the crude such that the temperature will not fall below the pour point during transportation, diluting the crude with lighter oils and transporting the crude as an aqueous emulsion,” said Mr Kasande in the presentation entitled oil refinery development in Uganda.
He also suggested use of chemical additives to depress the pour point as well as heat tracing to maintain the bulk crude temperature.
Mr Kasande said the study concludes that the pipeline option is not the preferred option.
“The length of the pipeline plus nature of the crude implies that this would be a very challenging pipeline to construct and operate. Besides, it would be the world’s longest heated pipeline,” Mr Kasande said.
The report indicates that a refinery project appears much more attractive than a crude pipeline to export crude.
“The key justifications for this are: refinery offers betters returns on investment for a relative small change in capital cost. The refinery offers better security of supply to Uganda and has a more positive impact on balance of payments and GDP,” reads part of the report.
AllAfrica – All the Time
Link:
Government in Advanced Stages of Oil Resource Management Plan