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Local oil and gas suppliers told to build partnerships

Weatherford is among the 293 companies that have been vetted by the Petroleum Authority of Uganda to render services in the Industry. Courtesy photo

Kampala, Uganda | RONALD MUSOKE | Ugandan suppliers looking at providing goods and services to the fledgling oil and gas sector need to build partnerships with their international counterparts if they are to fully participate in the multi-million dollar opportunities expected to flow in the coming months.

Elly Karuhanga, the Chairman of the local oil, gas and minerals lobby— the Uganda Chamber of Mines and Petroleum (UCMP) — said the suppliers need to partner with international players to enhance their capabilities as the oil and gas sector is a capital intensive business.

“Build partnerships with Kenyan and Tanzanian companies and make use of technical (legal and financial) advice to help you put up winning bids,” Karuhanga told guests during the national suppliers workshop in Kampala organized by Fluor and Ponticelli on Feb 06.

Based in the United States, Fluor, and the French-based Ponticelli are two of the three firms jointly doing the Front End Engineering Design (FEED) for one of Uganda’s oil fields commonly known as Tilenga.
Dave de Villiers, Fluor’s supply chain manager told the suppliers that there are huge opportunities with Fluor and its partner Ponticelli to participate in the supply of goods and or/services in the engineering, procurement, supply, construction, commissioning of the execution phase of the Tilenga project.

These opportunities are in the areas of gas supply for welding, crane hire, security services, soils and concrete testing services, land surveying, food and beverage supply, hotel accommodation and catering, locally available construction materials and waste management.
“Engage with the banks by showing them what you are going to do differently so we make sure that financing does not hinder the progress of the project,” said Xavier Feron, the project manager for Ponticelli.

Robert Kasande, the acting Permanent Secretary at the Ministry of Energy and Mineral Development told suppliers that the government is also encouraging joint venturing as a way to enhance capacity of local services providers.

But the suppliers raised a number of issues including high interest rates for local entrepreneurs.
Jennifer Mwijukye, the Chief Executive Officer of Unifreight, a local logistics firm, accused the local banks of using old experiences to lock out the Ugandan SMEs from accessing credit.

She said the local banks need to create products geared towards the oil and gas sector because projects in the sector are more viable than any other in the country.

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