Photo by: Bloomberg
KAMPALA – Uganda delayed on Wednesday the target date for announcing a lead investor in its planned crude oil refinery to February next year after bidders requested incentives for the project.
The east African nation plansned to build the refinery to process its hydrocarbon reserves, which were discovered along its border with the Democratic Republic of Congo in 2006.
Reserves were estimated at 6.5-billion barrels.
In June, the government selected two consortia, one led by South Korea's SK Group and a second led by Russia's RT-Global Resources, as the final bidders for the $2.5-billion project.
The ministry of energy previously aimed to announce the winner by the end of this year.
“During the negotiations, the bidders requested an incentive package," Kabagambe Kaliisa, the ministry of energy's permanent secretary, said in a statement.
"This required additional time for consultations."
The refinery project was to be developed under a public private partnership (PPP) arrangement and the lead investor was expected to take a 60% stake while the government took the remaining equity.
According to the statement, the project would involve development of a refinery and product storage facilities in Hoima, western Uganda, and a 205-kilometre product pipeline to a terminal near the capital Kampala.