Uganda’s energy minister on strategies for building capacityAugust 10, 2022
Ugandan Minister of Energy and Mineral Development Ruth Nankabirwa Ssentamu talks to The Energy Year about the key recent achievements of the ministry, its strategic goals and how it plans to leverage Uganda’s growing energy industry in order to maximise national content.
What have been the key achievements of the Ministry of Energy and Mineral Development in recent months?
The three programmes under the ministry – namely, the Sustainable Energy Development Programme, Sustainable Development of Petroleum Resources and Mineral Development – have led us to the enactment of a number of laws: the EACOP Act, Mining and Minerals Bill, or the Electricity (Amendment) Act. The Energy Efficiency and Conservation Bill of 2021 has also seen comments from the Cabinet secretariat and its corresponding regulatory impact assessment (RIA) incorporated. The Atomic Energy Act of 2008 was also amended, and a draft RIA was prepared.
In terms of Uganda’s power sector, the National Electrification Strategy’s development was concluded in December 2021. The Namanve thermal power plant was handed over to government following the expiry of the agreement with the developer, and the following dams were completed: the 42-MW Achwa 1, the 15-MW Nyamagasani I and the 6-MW Nyamagasani II. There was also an increase of 15.5 MW at the Sugar Corporation of Uganda Limited (SCOUL). Phase 1 of the studies for the rehabilitation of the Nalubaale and Kiira power stations was also completed. It is important to note that the Karuma HPP of 600 MW reached physical progress of 99.01% by December 2021 and is due for commissioning in October 2022.
With regards to the development of nuclear power infrastructure, nuclear power plant sites were ranked to identify the most suitable.
Moving to the oil and gas sector and the upstream in particular, the government has continued acquiring data in the Moroto-Kadam Basin, and we have enacted, as I have mentioned, the East African Crude Oil Pipeline (EACOP Act) 2021. A momentous event was the announcement of the final investment decision (FID) for Uganda’s oil and gas projects by TotalEnergies EP Uganda, CNOOC Uganda Limited, the Uganda National Oil Company (UNOC) and the Tanzania Petroleum Development Corporation (TPDC), which marked the beginning of the detailed engineering, procurement and construction (EPC) phase by the joint venture partners and EACOP company.
In terms of the planned refinery at the Kabaale Industrial Park, the front-end engineering design was concluded and has been approved by the government, and the ESIA study stands at about 95%. Continuing on the midstream and downstream side of the sector, the private fuel storage project by Mahathi Infra Ltd was at 96.22% completion, and the oil jetty at the Bugiri-Bukasa port in Kawuku on Lake Victoria was completed.
What are the key strategic goals that you plan to achieve before the end of 2022 and in the longer term?
Our key strategic pillars, with regards to the sustainable development of petroleum resources, revolve around six principles: ensure the sustainable production and utilisation of Uganda’s oil and gas resources; strengthen the legal and regulatory frameworks; enhance local capacity in the oil and gas operations; promote private investment; enhance quality, health, safety, security and environment (QHSSE); and improve the security of the supply of refined petroleum products.
In the upstream, our goals this year include developing the Local Content Development Fund Act, continuing our data acquisition work in the Moroto-Kadam Basin and issuing exploration licences for the Turaco and Kasuruban areas. In the midstream, it is our priority to conclude and implement key refinery agreements; develop guidelines for midstream licensing; and review the National Oil and Gas Policy.
In terms of our work in the oil and gas downstream, it is our goal to acquire a strategic partner to develop the Kampala Storage Terminal and have its engineering designs developed. The 200 acres of land have already been acquired. We are also targeting 25,260 LPG cylinder kits to be acquired and distributed. Before 2022, we will also develop the Lake Transport Routing master plan.
With regards to power generation, it is very important to focus on increasing our energy generation capacity, as well as to promote the utilisation of energy-efficient practices and technologies and to increase the adoption and use of clean energies. The principles guiding our actions in the transmission and distribution space focus on ensuring an increased electricity access rate, as well as consumption. For example, this year we are targeting the 100% completion of the transmission and substation works of the Lira-Gulu-Agago 132-kV project.
It is very noteworthy to underline that we have prepared the Atomic Energy Amendment Bill and we are also preparing the local content strategy for nuclear energy development.
How is the ministry planning to leverage Uganda’s growing energy sector in order to maximise national content?
The ministry is implementing a local content policy which is intended to increase the retention capacity of foreign direct investment inflows into the sector. The government is also promoting development of technical capacity of human resources through various projects. For example, the Uganda Electricity Generation Company (UEGCL) is currently managing the Isimba HPP, and UEGCL is also in the process of preparing to take over Karuma HPP after its completion.
The ministry is currently ensuring that human capacity is developed in order to facilitate proper takeover of several projects under the build, operate and transfer arrangement. These include the Namanve Thermal Power Plant, which was handed over to the government in March 2022, as well as Nalubaale HPP, which will be handed over in 2023. The ministry has set up strategies to build local technical capacity in energy solutions through, for instance, the setting up of an Integrated Energy Laboratory to address various forms of energy.
The ministry is also in the process of developing a financing mechanism to address supply-side and demand-side financial barriers inhibiting energy investments in the medium to long term. This shall be done through strengthening of financing institutions, for example Uganda Electricity Credit Capitalisation Company (UECCC), to enable them to finance energy investments.
On the occasion of Uganda’s 60th anniversary of independence, which do you think have been the key drivers of progress for the nation in the last few decades?
The visionary leadership by the president has been the leading factor driving progress in Uganda. The prevailing peace and security in the country has led to a conducive environment. Human capital development and steady infrastructural development have been very consequential. This is evident with the numerous projects within the sector including the construction of hydropower plants, an increase in the transmission and distribution network, as well as supporting infrastructural developments such as transport and ICT networks in various regions of the country.
The legal and regulatory framework in the country prioritises investment promotion in all aspects of the development including the energy, oil and gas sectors. This has in turn contributed to the economic development of the country.