Uganda seeks firms to repair fuel storage facility


The Uganda government has invited bids from firms to refurbish, restock and manage the country’s fuel reserve tanks, said the energy ministry.

East Africa’s third largest economy, like its neighbours, is grappling with high fuel prices which have fed into rising inflation.

The country’s year-on-year inflation has been rising since late last year and jumped to 16.0 percent in May, the highest since 1994, which led to sometimes violent demonstrations in April and May, Reuters reports.

When revamped the tanks at the government’s strategic reserve facility – built in Jinja in 1988 — are expected to store 30 million litres of fuel, two thirds of which will be diesel and the rest petrol.
“The ministry (of energy and mineral development proposes to engage an operator for a period of ten years to refurnish, restock, operate and manage the facility,” it said in a statement published in local Daily Monitor newspaper.

Landlocked Uganda relies on Kenya’s Mombasa port for its oil shipments and experiences frequent fuel supply disruptions, mostly caused by supply hiccups in Kenya.

The government is banking on the reserves to help stabilise the supplies before it starts producing its own petroleum.

Uganda discovered commercial hydrocarbon deposits in the Albertine Rift basin in its west in 2006 and production is expected to commence early next year.