Updates on Oil and Gas Development Projects: EACOP, TILENGA, KINGFISHER

1.EACOP: The EACOP will require a USD 3.5-billion investment for a 1,440-kilometre, 216,000-bopd capacity pipeline that will export crude oil from Kabaale in western Uganda to the port of Tanga. The EACOP will be the world’s longest electrically heated crude oil pipeline, allowing the transportation of Uganda’s high-viscosity oil. The pipeline will be managed by the EACOP Company, formed by operator TotalEnergies (62%), UNOC (15%), TPDC (15%) and CNOOC (8%).

In May 2022, Bolloré Logistics announced it had been selected as the main logistics contractor services for the EACOP. The project’s materials and equipment will be discharged in Dar es Salaam, Tanzania, and transported to different locations in Tanzania and Uganda. Works involve end-to-end receiving, storage, handling, and transportation of hundreds of thousands of cubic meters of cargo, including over 80,000 joints of 18-meter line-pipe, multiple heavy-lift operations, break-bulk, and containerized cargo transportation.

Other contractors for the project include China Petroleum Pipeline Engineering for the construction of the pipeline, feeder line, and aboveground installations; the Daqing Oilfield Construction Group for the construction of the terminal and tanks; SNEF-Schneider for electrical instrumentation and control of telecom security; BBN for construction of the jetty; and ISOAF Tanzania for provision of the thermal insulation of the pipeline. Engineering firm Worley is in charge of the engineering, procurement, construction management and commissioning.

In July 2022, the operating company submitted a request to the government of Uganda to begin pipeline construction activities. According to Uganda’s Ministry of Energy and Mineral Development officials, the submitted application was to be approved before the end of 2022.

 

2.TILENGA: The Tilenga Project, operated by TotalEnergies EP Uganda, covers three production licenses in Contract Area 1 – Jobi-Rii, Gunya, and Ngiri – and three in License Area 2 North: Kasamene-Wahrindi, Kigogole-Ngara, and Nsoga. The total expected production of these fields is 190,000 bopd.

The project will comprise more than 426 wells with more than 160 kilometers of flowlines connecting the fields to the central processing facility (CPF). The CPF will have a capacity of 190,000 bopd, and will be connected via a 24-inch, 95-kilometer pipeline to the Kabaale refinery.

Major contracts were announced after the February 2022 FID announcement, and contractors were mobilized. Tier 1 contractors include McDermott, Sinopec, ZPEB, Vallourec, and Mota-Engil Uganda. Drilling rigs are currently under construction in China and the first is expected to arrive in the second half of 2022 so that drilling can kick start in December 2022.

In January 2022, GCC Services signed a six-year contract with international engineering and construction company McDermott to provide camp services for the upstream facilities at the Tilenga Project beginning the following month. Works include camp management, catering, and camp support services for the workforce on the project, which is estimated to consist of up to 3,500 international and local workers.

Immediately after the FID was announced, Mota-Engil Uganda was awarded three contracts worth USD 261 million for works on the Tilenga Project. These include two contracts from TotalEnergies for preparing good pads and related infrastructure. McDermott awarded the third contract in consortium with Sinopec for general civil works.

3.KINGFISHER: The Kingfisher project is operated by CNOOC. The Kingfisher Development Area (KFDA) covers the Kingfisher field in the area formerly known as Block 3A, located in the Kikuube district, and there are plans for tie-ins of the Mputa-Nzizi-Waraga fields in the Hoima district. The total production expected from these fields will be 40,000 bopd.

CNOOC obtained the production license for the KFDA in September 2013, and the Environmental and Social Impact Assessment certificate in February 2020. The upstream development will comprise 31 wells to be drilled in four well pads, as well as a 40,000-bopd CPF fed by 19 kilometers of flowlines. Midstream-wise, a 46-kilometer pipeline will connect the CPF to Kabaale.

After the announcement of the FID, Uganda’s Excel Construction kicked off the construction phase at the Kingfisher project involving building well pads, access roads, and water intake points.

The Tilenga and Kingfisher developments, whose combined output is expected to reach 230,000 bopd, will be connected via feeder lines to the UNOC-managed Kabaale Industrial Park near Hoima. The Kabaale Industrial Park will comprise an international airport, expected to be operational during 2023; Uganda’s crude export hub, from which EACOP will start; a 60,000-bpd refinery, whose FID is expected in 2023 and its completion in 2027; and an industrial park.