Industry news

How Kabaale Industrial Park will spur economic growth

Day 5 #90daysofoil  – The Kabaale Industrial Park

Two macro-economic studies done for the refinery on one hand and the Kabaale Industrial Park (KIP) on the other hand shows the projects will contribute $3.3billion and $4.9billion respectively to GDP annually.

Uganda National Oil Company (UNOC) Limited, a wholly owned government company that will oversee the country’s business interests did the study jointly with Stanbic bank.
The study follows acquisition of 29.57sq km land located at Kabaale in Hoima for purposes of establishing an oil and gas industrial park.

The industrial park will host all petroleum related industries, warehouses and more. The intention is to spur industrialization with a backward and forward linkages to the refinery.

The KIP master plan has been developed to take into account considerations for future developments.

The Refinery project
Uganda has planned for a 60,000 barrels of oil per day refinery to be located at the KIP. The overall cost of the refinery is projected at $4.27billion. The refinery is being established under private- public partnership between UNOC and Albertine Graben Consortium.

In addition, the study finds that the refinery shall contribute $8.2billion to the National Capital Formation. When completed it shall create up to 32, 000 job opportunities Under this arrangement, the investor finances 100% of the project and then operates it. Government shall come at appropriate time through Uganda Refinery Holding Company, a subsidiary of UNOC.

Albertine Graben Consortium (AGRC) is comprised of YAATRA, Saipem SpA, Lion Works Group and Baker Hughes General Electric.
The consortium signed a Project Framework Agreement (PFA) in April 2018 in Kampala. The PFA gave it greenlight to undertake all the pre-Final Investments Decision (FID) activities.

AGRC will build product storage facilities and construct a 211km product pipeline from Hoima to Kampala to serve Burundi, Rwanda, eastern DR Congo, northern Tanzania and western Kenya.
The product pipeline shall have a storage terminal at Namwambula in Mpigi, south of Kampala city.
The refinery is designed to produce several products including: diesel, petrol, kerosene, jet fuel, liquefied petroleum gas and heavy fuel oil.

Refinery benefits: contribute $8.2billion to the National Capital Formation and create up to 32, 000 job opportunities, net fiscal impact of $591million and import substitution.
Detailed design, procurement and construction (EPC) is expected to commence in June 2023 for 4 years. Refinery commission has been planned for 2027.

The Industrial Park
The Kabaale Industrial Park(KIP) has been designed to accommodate an International Airport. The airport is under construction. It will also host a Crude Oil Export hub, a refinery, , petro-chemical and fertilizers industries, industrial gases cold chain for agro–processing and warehousing and logistics.
Macro-economic studies of the KIP benefits:
$11.9billion per annum to the national capital formation
Increase Uganda’s balance of payment by $849 million yearly Fiscal impact of $1.2billion per annum and create about 35,000 job opportunities.

Kabaale International Airport
Also to be established within the industrial park is Uganda’s second International Airport and all its terminals. The engineers have done over 70 % of the work. The contractor, SBC (Uganda) LTD is doing the job at a cost of UShs 1.3 trillion and is expected to be complete in 2023.

To top