Ugandans have been advised to quickly prepare themselves for the imminent opportunities in the oil and gas sector now that the Final Investment Decision (FID) is set to be officially announced, come February 1, 2022.
Speaking on a Twitter Spaces this week, Tony Otoa, the Chief Executive, Stanbic Business Incubator, said that it was important that Ugandans are encouraged to take up the various opportunities in the industry because it would help the economy grow exponentially.
“What we strive to do every day is to see local participation in the oil and gas sector. We cannot, and we shall not, watch opportunities leave us. Let’s do whatever it takes to be great businesses that can be part of this oil and gas story,” Otoa said.
FID is the point in an energy project in which the companies operating the venture sanction its development.
After successfully completing the appraising of 6.5 billion barrels of oil equivalent in place with 1.4 billion barrels said to be recoverable, Uganda has now entered the development stage that will later lead to field production.
Development activities and processes involve environmental impact assessments, geophysics, geology, reservoir and production engineering, infrastructure development, well design and construction, completion design, surface facilities, economics and risk assessment.
The development phase alone will see about $15 billion to $20 billion invested in Uganda before oil production starts. It is hoped that participation of local entities increases from 28 per cent to 40 per cent during this phase.
It is the busiest period in the lifecycle of such a project, with infrastructure including the crude export pipeline, field pipelines, a refinery, storage terminals, residential camps for workers, among others, to be built. There will also be a need for provision of goods and services like food, construction materials and ICT solutions.
Uganda’s economy, currently estimated at $37 billion, is expected to expand by 22 per cent over the next three to four years of the construction phase through linkages between the oil sector to other sectors like agriculture, tourism, manufacturing and transport.
The Stanbic Business Incubator, a subsidiary of the Stanbic Bank, has over the last few years been training small and medium enterprises (SMEs) in a range of business skills to bolster them into building strong and sustainable businesses, fit to compete for the highly standardized opportunities in the oil sector.
The Incubator’s Twitter Spaces conversations about the sector will run weekly.
“Today my role has just been to give a helicopter view of the opportunities therein. Starting next week, we shall host experts to help you further understand what is required of you to benefit from the oil and gas sector,” Otoa said.