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Oil and Gas Pipeline: Demand For Goods And Services In Oil and Gas Pipeline Project Life Cycle


With massive natural gas discoveries in Tanzania. And immense crude oil reserves found in Uganda and Kenya. More pipeline infrastructures are needed in East Africa.

East Africa ’s energy demand has been growing steadily in recent years. And is expected to keep growing for the for the next twenty years.

The shortage of infrastructures means that more oil and gas pipelines are needed.
That means oil and gas pipeline is a growth sector in East Africa.

Uganda has chosen to transport its oil through Tanzania route. And also Tanzania is planning to build a pipeline that will carry natural gas from production areas to Uganda.

The more pipeline projects, the more opportunities in the region.

But it can be a little bit hard to capitalize on the opportunities offered by the pipeline project if you are unaware of the demand for goods and services in the pipeline project life cycle.
Because the demand for goods and services varies along the pipeline project life cycle.

If you are planning to be part of the new and huge oil and gas pipeline projects in Tanzania and East Africa. This article shows tremendous procurement opportunities in the pipeline projects.

. Opportunities in the oil and gas pipeline project life cycle.
Like a human being life, has stages including birth, growth, maturity, growth, and death. Pipeline projects also have a life with sequence phases including planning, construction, operation, and closure.


This is the first stage that covers everything from securing regulatory approval, getting all permits of the people affected by the projects and estimating costs required to complete the project.
The planning phase is characterized by low field activity. Relatively happen in the field expect environmental, social and Front end engineering and design (FEED) study.

To enrich your background FEED is a stud conducted to determine the actual cost of the project and gather technical information.

During FEED the following objectives are also achieved.
Selecting entity that will operate and maintain the pipeline and associated facilities.
They also complete the required agreement with host governments.
Procurement opportunities are very limited and short term during the planning period.

2. Construction.

Once we have all agreements and know the labor and equipment cost, the Final investment decision is made and construction begins. The construction stage start by rapid mobilization of construction equipment and manpower to the site. The stage presents huge opportunities for suppliers and service providers. Oil companies start to spend a large amount of money. The number of equipment and personnel moved to the site is amazing during this period. To put it simply the big hiring boom for supplies and services begin at the construction stage.

3. Operation.

Once the pipeline construction is completed, we move on to the operation phase. The stage involves getting the products (oil or natural gas) to the market (consumers). The supply chain opportunities in this stage are a limited and long pipeline. Many oil and gas pipelines are designed to operate for 15 to 25 year.

Unlike the construction phase, operation phase is characterized by low activities and reduction of workforce.
The main activity in this stage is the maintenance of the pipeline and associated facilities.
Procurement and supply opportunities are medium but long term in this stage.

4. Closure
Finally, at end of their useful oil and gas pipeline must be closed. This stage is also called decommissioned The stage cover everything from emptying and removing pipeline and its associated facilities and return its route. Procurement opportunities are limited during this phase. However, some few supply and services opportunities arise when the activity to turn the land as close to its original condition. Example of activities during this phase is the removal of construction materials and large rocks.

That’s a demand analysis for an oil and gas pipeline project. Hopefully, this helps. Good Luck.

Updated: January 10, 2019 — 9:43 AM
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