Government, CNOOC in preparatory stages for Kingfisher oil well

An oil rig in western Uganda. CNOOC is yet to get a 25 year licence for the oil well. FILE PHOTO 

By  FREDERIC MUSISI

 

Kampala- The government and the Chinese North Offshore Oil Company (CNOOC) are embarking on the last rounds of preparations for the Kingfisher oil well where production is expected to start in 2017.

A source who is not authorised to speak to the press said the oil company put out tender notices, and international companies like Italy’s Saipem, Australia’s Worley Parsons, the US’ Flour and UK’s Wood Group, had all expressed interests.

“Awarding of this contract is in the final stages because both commercial and technical bids have been conducted.”

CNOOC’s communications head Chai Wei was not available for comment.

The Chinese State-owned CNOOC is yet to award a tender to a contractor for the Front Engineering and Design (FEED) on the production area, which is estimated to hold up to 800 million of oil barrels.

The FEED, which is expected to take a year, is one of preparatory studies undertaken following the initial submission of a Field Development Plan (FDP) for a discovery area, and it determines the technical requirements. It also estimates the cost of the required infrastructure to start production.

The study is expected to cover, among others, layout of well pads, production and water injection, central processing facilities, storage and transport facilities’ analysis.

Information from government’s Petroleum Exploration and Production Department (PEPD) indicates that only CNOOC and UK’s Tullow Oil PLC submitted their FDPs.

The FEED on $4 billion (about Shs10 trillion) Kingfisher project will be run in two stages. First, to develop drilling mechanisms south of the oil well and establishment of a central processing plant with up to 20,000 barrels-per-day, and second to handle production.

PEPD communications officer Catherine Bekunda in an email said, CNOOC was granted a conditional production licence for Kingfisher “after submitting their FDP and the Petroleum Reservoir Reports (PRR), documenting proposed work programme, currently under review.”