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Standard Bank to fund oil projects

KAMPALA.

South Africa’s Standard Bank Group has said it has considered offering financial services to upstream projects in the oil sector, notably the refinery, pipeline and development of oil fields.

The bank is one of the biggest lenders on the continent with an estimated asset base of $85 billion (about Shs216 trillion).

Officials from the bank were on stakeout for funding deals in the country last week, the second time when government and International Oil Companies (IOCs) signed a memorandum of understanding (MoU) to clear the way for production.

Investor confidenceThe bank’s Global head of Oil Gas, Mr Simon Ashby-Rudd, said the MoU raised investor confidence and equally opened up possible opportunities for investments. “Whatever is of commercial benefit to the oil industry and is of benefit to Uganda, is certainly an opportunity to us,” Mr Rudd, remarked, “We have developed strong capabilities over the years in financing oil and gas projects in Africa—in Ghana and Angola, and believe we can make it in Uganda.”

The MoU defines the commercial framework produced by the IOCs—UK’s Tullow Oil PLC, France’s Total EP and China’s Cnooc and lays out a route-to-market framework for the oil resources currently surpassing 3.5 billion barrel.

The framework details a refinery and a crude export pipeline and crude to power plant.

Mr Rudd, added: “Our role here would be offering financial aice to companies and possibly where necessary bring in big financial lenders from countries like Japan, China and Russia, whose firms are currently bidding to construct the 60,000 barrels-per-day (bpd) refinery.”

Mike Blades, the regional head of East Africa Corporate Banking, maintained, much as they are presently looking at all projects, the refinery stands out loud.

“With a code of work, we can be a part of all these components ideally a strategy will be required to assure investors and clear capital mix international investors.” he remarked.

Officials from the Bank which owns Stanbic bank also held closed-door meeting with executives from Tullow Oil although the agenda has been kept secret.

The entire upstream projects, refinery, pipeline and crude to power plant is estimated to cost between $15billion-$20 billion, but value engineering processes are ongoing to establish definite costs.

about the refinery

The refinery construction, to start in 2015, is estimated to cost $3 billion and a pipeline $4 billion. The oil industry as of 2014 has recorded investment flows of $1.3 billion.)

SOURCE: Daily Monitor

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