Total signs USD 2 Billion deal for Tilenga project

The Tilenga project is expected to attract over USD 10 billion in investments in Uganda and Tanzania

Kampala, Uganda | THE INDEPENDENT | Total E&P Uganda has signed five packages for drilling of oil wells in Nwoya and Bulisa districts under the Tilenga project. The approximately two Billion dollar deal will also provide for surface facilities Engineering, Procurement, Supply, Construction and Commissioning (EPSCC).

These conditional awards are a first step that allows for the launching of the detailed engineering and procurement activities before the final approval by the partners. Total E&P Uganda General Manager Pierre Jessua in a statement on Monday said the selection of the five companies followed what he described as a comprehensive and thorough tender evaluation and contracting process.

“The launch of these contracts underscores our commitment to developing the Tilenga project while maximising the value and viability of the project, and observing the most stringent health, safety, social, environment and quality standards to which the contractor must adhere,” said Pierre Jessua.

He said the companies above have also made significant commitments to promoting National content through employing Ugandans, use of Ugandan goods/services and technology transfer.

“Thanks to this first step, the Tilenga project development phase has a target to achieve the first oil in 43 months. All the companies will deploy their years of expertise and best-in-class technology to delivering the project while also ensuring sustainable value retention in the economy through promotion of national content,” said Pierre Jessua.

Among those awarded is a consortium of a subsidiary of McDermott International Ltd and Sinopec International Petroleum Service Corporation. The formal contract award remains subject to Tilenga partners approval. Others include; Schlumberger Oilfield Eastern Limited for three well-engineering packages and Upper Completions, Artificial Lift and Associated Services.

A Ugandan company ZPEB Uganda Co. Limited is one of those to take a pie of the lucrative deal. It is to win one rig package for onshore drilling rigs, tubular running and fishing services.

The Tilenga project is expected to attract over USD 10 billion in investments in Uganda and Tanzania. It includes six oil fields and will feature 426 oil wells at full production will generate up to 200,000 barrels per day (BPD). It will consist of 31 well pads connected to a central processing facility (CPF) via buried flow lines. A central processing facility located in Buliisa, outside the Murchison Falls National Park.

Reports about this deal were last week broken by McDermott International Ltd and Sinopec International Petroleum Service Corporation.

“This is a the first step which allows launching the detailed engineering and procurement activities before the final approval by the partners. This prestigious project demonstrates the continuity and strength of our business relationship with Total Energies and their partners CNOOC International of China and Uganda National Oil Company (UNOC),” said Tareq Kawash, Senior Vice President, Europe, Middle East, Africa.

“This is a momentous and essential project for Uganda for the development of its national companies and citizens, and as we continue to grow our footprint in Africa, we are committed to expanding local content opportunities in the communities in which we operate.” The project will stimulate economic growth in Uganda and create up to 20,000 direct and indirect jobs, bringing a significant number of meaningful training opportunities for the local labour force.

McDermott is committed to implementing these projects in a manner that fully addresses the sensitive environmental context and the needs of all stakeholders in the area.

“This important step further strengthens years of successful collaboration with Total Energies on a wide portfolio of world-class projects in the Offshore, Petrochemicals and LNG segments where Total Energies is a major stakeholder,” said Samik Mukherjee, McDermott’s Group Senior Vice President for Projects.

The project will be led from McDermott’s offices West of London, United Kingdom and Sinopec’s office in Yangzhou, China, before transitioning to Uganda for the construction activities. Work began in the second quarter of 2021 and the first oil is expected in 2025.

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