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Why data centres are key boosters for oil and gas sector


COMMENT | JAMES BYARUHANGA | On February 2, 2022, Uganda made a very significant step towards realising its first oil fortunes. We witnessed the announcement of the Final Investment Decision (FID) for Uganda’s oil and gas Projects by the Total Energies EP Uganda, CNOOC Uganda Limited, the Uganda National Oil Company (UNOC), and the Tanzania Petroleum Development Corporation (TPDC).

The FID is the capital project planning process when making significant financial commitments. Major equipment orders are placed at the FID point, and contracts are signed for Engineering, Procurement and Construction (EPC) firms to deliver a complete package of resources to complete infrastructure projects.

Key signatories to the FID ceremony were Yoweri Kaguta Museveni, President of the Republic of Uganda and Phillip Isdor Mpango, the Vice President of the United Republic of Tanzania.

Oil has been the world’s most important energy source since the mid-1950s. Its products underpin modern society, mainly supplying energy to the power industry, heat homes and providing fuel for vehicles and aeroplanes to carry goods and people worldwide.

Therefore, the discovery of oil in Uganda presents a unique opportunity to transform the economy through infrastructure development and poverty alleviation. Oil is expected to contribute an average net present value of US$ 2 billion (10% of GDP) for at least 26 years (Langer, Arnim, et al., 2020).

In an industry as nascent as oil and gas in Uganda, where does the impact of ICT and in, specific – the role of data centres lie?

Globally, data centres play a pivotal role in providing solutions to big data management; by managing large volumes of data generated from day-to-day operations. Looking at the oil and gas industry in Uganda, we shall need to keep information and secure data at the different stages of the oil generation process that include exploration, mining, refining, transportation as well as in the Petro Chemical industry.

With the government having plans to develop a 60,000 barrels of oil per day refinery at Kabaale, Buseruka Sub-County in Hoima District, the large volumes of data generated by the oil and gas industry will have increased significantly, driving the demand for high-performance data storage and processing solutions.

The Uganda Refinery project, which includes development of 211-kilometre petroleum products pipeline from Hoima to North West of Kampala, is estimated at US$ 3 – 4 billion. All this information and data needs to be kept somewhere hence the need for data centres to catch up with this demand.

Whereas Uganda has not yet started production activities, the need for data centres to store and process real-time data collected from a wide range of production equipment is critical.

As Uganda starts her long journey into oil and gas exploration, the companies that will invest in data centres will gain significant operational efficiency and financial stability. They’ll enjoy the benefits of processing data in real-time while generating insights to create revenue opportunities, increase drilling performance, and improve operational efficiencies.

All this is down to the application of big data analytics that allows real-time monitoring, real-time performance and real-time prediction for adverse situations such as equipment malfunction.

Do not forget, just like in other industries, data centres serve the critical purpose of providing backup and recovery solutions in the event of an integral system failure or data loss in their operations.

As I conclude, it is vital to cryptically state that data is the new gold, the new oil, and the new plastic, to this effect; collecting, processing, and protecting it with the highest form of data centre technology is essential.


 Byaruhanga is the Raxio Data Centre – General Manager

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