Corporate News Blog - Uganda Government Selects a Consortium Which Includes General Electric to Develop Ugandas Refinery Project

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Accesswire 9-Aug-2017 7:40 AM
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LONDON, UK / ACCESSWIRE / August 9, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for General Electric Co. (NYSE: GE), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=GE. The Government of Uganda announced on August 07, 2017, that it has selected a consortium consisting of American, Indian, and Italian firms for the development and construction of the Uganda Refinery Project. The Consortium named the Albertine Graben Refinery Consortium (AGRC) includes General Electric Company'sOil and Gas division, India'sYAATRA Ventures LLC (US), Intracontinent Asset Holdings Ltd (IA), and Italy'sSaipem SpA. Saipem will be the EPC (Engineering, Procurement, and Construction) Partner. For immediate access to our complimentary reports, including today's coverage, register for free now at:
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The four aforementioned companies were selected by the Government after reviewing proposals from over 40 Companies that had expressed interest in the project. The Government expects the development of the Oil Refinery to push the growth of petrochemical and other related industries in Uganda.
The Government had been in advanced negotiations with Russia'sRT Global Resources LLC and South Korea'sSK Engineering & Construction Co. for the Refinery project. However, the negotiations fell through in 2016, after which the Government had to recommence the process of identification of potential investors for this project.
Proposed Roadmap for Finalization of Project Partner
According to Dr. Stephen Robert Isabalija, the Permanent Secretary in the Ministry of Energy and Mineral Development of Uganda, the country's government has signed an agreement outlining the core project terms with the Consortium. The Consortium has suggested that the Government follow the financing approach to this project and chalk out a plan to establish, develop, and operate a commercially viable refinery.
The next step in this project would be the signing of the Project Framework Agreement (PFA). The PFA would be finalized after successful negotiations between the Government and the Consortium with regards to proposed solutions, validation of the solutions, risk mitigation measures, and additional due diligence necessary for accelerating investments and financing for the project. The PFA is expected to be signed within the next two months. If the terms and conditions are agreeable to all concerned parties, the Consortium will be granted the rights and licenses to develop and manage the refinery. The Consortium's role at this stage would be that of a lead investor in a joint venture partnership with the Government.
The future steps after the signing of the PFA include commencement of pre-Final Investment Decision (FID) activities such as Front-End Engineering and Design (FEED), Project Capital and Investment Costs Estimations (PCE), Environmental and Social Impact Assessments (ESIA), etc.
About the Uganda Refinery Project
The Greenfield Uganda Oil Refinery is in the Albertine Graben region also known as The Lake Albert basin and forms part of the western arm of the Great Rift Valley system in East Africa. Uganda discovered commercially viable oil reserves in its Albertine Graben region in. 2006, but the actual production has been delayed by tax disputes and other disagreements over development strategy.
The proposed Uganda Oil Refinery is expected to be built in a 29 square kilometers of land in Kabaale Parish, in Buseruka Sub-county, Hoima District, in Western Uganda. The Government's participation in the development of this project is through the Uganda Refinery Holding Company (URHC), a subsidiary of the Uganda National Oil Company (UNOC). The refinery is expected to process over 60,000 barrels of oil per day. However, initially the plant would process only 30,000 barrels of oil per day. The development of the refinery is estimated to cost over $4.27 billion and will include the construction of a product pipeline which will start in Hoima and end at Buloba, located in the west of Kampala.
The project is expected to be operational by 2020 and the pipeline is also expected to be completed around the same time. US based Total SA (NYSE: TOT), UK'sTullow Oil PLC, and China'sCNOOC Ltd are already developing the fields for the extraction of crude oil. The fields have 6.5 billion barrels of resources and the proposed refinery is expected to process the crude oil extracted by these Companies.
Last Close Stock Review

At the close of trading session on Tuesday, August 08, 2017, General Electric's stock price slightly dropped 0.27% to end the day at $25.56. A total volume of 27.00 million shares were exchanged during the session. The Company's shares are trading at a PE ratio of 29.31 and have a dividend yield of 3.76%. At Tuesday's closing price, the stock's net capitalization stands at $221.63 billion.

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