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South Sudan and Equatorial Guinea seal oil deal

Posted JOSPEPH ODUHA in Juba

on  Tuesday, March 21   2017 at  11:44

South Sudan and Equatorial Guinea have unveiled an oil and gas partnership.

The deal was announced in Juba on Monday following the visit of the Equatorial Guinea oil minister, Mr Gabriel Mbaga Obiang Lima.

South Sudan Oil minister Ezekiel Gatkuoth Lol said in a press statement that the new deal will pave the way for information exchange between the two countries.

“Partnership is what fuels the oil industry. South Sudan is proud to share its experiences with Equatorial Guinea, and to learn from the great work of our fellow African producer.

Nation’s development

“The petroleum industry is crucial to our nation’s development. This agreement signals our dedication to investing in the sector as a driver for South Sudan’s growth,” Mr Lol said.

Mr Lima praised South Sudan for the new deal, saying sharing of expertise between the two countries was vital.

“The sharing of resources and knowledge between African oil and gas countries is critical. Going forward, Equatorial Guinea will work closely with South Sudan for the benefit of our people and our national economies.

“The lines of communication are open and we look forward to a deep and lasting collaboration,” he said.

Facing collapse

South Sudan was working to more than double oil output to 290,000 barrels per day.

The young nation has relied on oil revenue to fund its projects since its independence in 2011.

The economy of the country was currently facing collapse after the outbreak of war in 2013.

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Cabinet approves revival of Uganda Airlines

Posted FREDERIC MUSISI in Kampala

on  Sunday, March 12   2017 at  18:20

Cabinet has approved a proposal to get the Uganda Airlines project off the ground.

A key aspect of the decision is to get on board a transactional adviser to guide the process.

Works minister Aggrey Bagiire, who is at the heart of the project, told the Sunday Monitor that since the political leadership had already explained the reasons for reviving the national carrier, as listed in the Second National Development Plan (NDPII), the approval was expected.

A debate

“Whether we need a national carrier or not is no longer a debate,” Mr Bagiire said.

“It is true the matter came up in Cabinet but it would be treasonable for me to discuss what was discussed,” he added.

The transactional advisor will also look into how the new national carrier would run and other key variables of the project.

Specific timelines

Although the revival plan also includes specific timelines, sources familiar with the matter told the Sunday Monitor that the national carrier was not about to fly any time soon as had been hoped, owing to financial setbacks and other structural challenges.

Uganda used to have a national airline, established in May 1976 under the Idi Amin government.

However, Uganda Airlines was liquated in 2001 over heavy debts of more than $6 million.

Ticket prices

The liquidation did not settle in well with a number of stakeholders, who blamed the government for deliberately killing the airline.

During his inaugural address to Cabinet last year, President Yoweri Museveni said the lack of a national airline was “a big shame,” criticising Kenyan, Ethiopia and South African “brothers” for ditching the comradeship and instead opting to exploit Ugandans.

National airlines of those countries, which fly through Uganda, were accused of charging exorbitant ticket prices.

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Insurance app launches in Uganda

Posted PHILOMENA MATSIKO in Kampala

on  Saturday, March 11   2017 at  17:56

Uganda has become the first African country to market SureBuddy, a new android application for insurance.

The new application was launched on Friday in partnership with Africell, one of the major telecommunications companies in the country.

With this application, the users are expected to download and then watch a minimum of 180 adverts that come along with it on a monthly basis, approximately six adverts a day, to unlock their cover.

The repair value

Under the free cover, several offers like repair of broken screens of smart phones are made available to the user, through the application’s partners like Phone Doctor.

However, a consumer is expected to pay a maximum of 10 per cent of the repair value, considered as administration fee.

Advertisers cover all the costs, which in return enable SureBüddy to use the revenue to reward the user directly with cover.

Smart phone penetration

SureBuddy spokesperson Johan Basson said Uganda was one of the countries with the fastest smart phone penetration and therefore would have a significant growth on both the application and users.

However, the penetration levels of insurance in Uganda were still low.

The scenario, according to Uganda insurance association, was due low levels of sensitisation amongst the population, and the impression created that insurers did not pay claims.

SureBüddy also intends to roll out into 11 sub-Saharan Africa countries, as well as India, Turkey, Indonesia, Philippines, Pakistan and then South American countries.

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Call for migration-friendly laws in Africa

Posted ANDUALEM SISAY in Addis Ababa

on  Saturday, March 11   2017 at  12:51

African governments have been called upon to develop a legal framework to allow labour migrants to travel within the continent.

An International Organisation for Migration (IOM) official, Mr Aron Tekelegzi, said the bulk of African illegal immigrants preferred to work and stay within the continent.

“If you don’t allow Africans to travel freely within the continent, it is a mistake to expect Europe to accept African migrants," said Mr Tekelegzi, who presented a paper in Addis Ababa on Friday.

Illegal route

"Unless we expand the legal route for the migrants, which is less costly, people will continue to choose the illegal route even though they know it is very risky,” he said.

Out of the total of 30 million African migrants in 2016, 20 million stayed in the continent, according to IOM.

Mr Aron presented the paper on illicit migration from the Inter-Governmental Authority on Development (Igad) region and its implications, at a forum organised by the Horn Economic and Social Policy Institute (HESPI).

The Africa Union Commission’s Migration Advisor, Mr Peter Mudungwe, disclosed that the Commission had prepared a 10-year programme that would allow African labour to move and work within the continent.

Total population

“We hope to get this plan approved by Africa heads of state by early 2018,” he said.

In 2016, the Igad states of Somalia, Sudan, Ethiopia, South Sudan, Kenya, Eritrea, Uganda and Djibouti, with a total population of close to 254 million, were a major source of migration.

Out of the region's 8 million migrants, 5.6 million ended up in shelters for the internally displaced people, while the remaining were distributed to the rest of Africa, the Middle East, Gulf countries, Europe and North America.

The drivers

High population growth, prevalent and rising unemployment and underemployment, particularly among the youth, are some of the drivers of inward and outward immigration of Africans in the Igad Region, according to HESPI Managing Director, Ali Issa Abdi.

“Insecurity, instability and intolerable economic deprivation, and perennial droughts and adverse climate impact are also major drivers of migration in this sub-region,” he said.

Countering the usual narrative that, ‘the main push factors for increase of illegal African migration are poverty and conflict’, he noted that a poor person cannot afford to pay traffickers between $6,000 –$10,000 to reach Europe.

Climate change

“Socio-economic development and migration have direct correlation with middle income societies exhibiting the highest level of mobility…

"Better access to information paves the way for mobility of the well-earning people. In addition, it is estimated that climate change may lead to migration of 250 million people globally in the coming 10 years,” he said.

Currently, some 240 million people across the world were migrants, according to Mr Aron.

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Johnson&Johnson launches Nairobi hub

Posted AFRICAREVIEW.COM

on  Friday, March 10   2017 at  11:22

Healthcare products manufacturer Johnson&Johnson has set up an operations hub for East Africa in Nairobi.

The move is a departure from working through distributors in the region, in what the company says will help them understand the market better.

The Group Chairman Europe, Middle East and Africa, Ms  Jane Griffiths, said the Nairobi hub would  be key to developing new vaccines and devices for health issues unique to the region.

“Having a foot in the region will allow us to better understand the realities and the challenges specific to East Africa and come up with solutions and partnerships which best addresses the issues,” said Ms Griffiths.

The company

She added the choice of Nairobi was arrived at because of political stability and the market potential.

Mr Jaak Peeters, the Johnson&Johnsons global head of public health said the company already developed an Ebola vaccine and a cure for the drug-resistant strain of TB.

The East African office becomes the third after the Ghana one was launched on Tuesday. The other office is in South Africa.

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Foreigners to pay $10,000 for S. Sudan work permits

Posted JOSEPH ODUHA in Juba

on  Tuesday, March 7   2017 at  14:43

The South Sudan government has raised work permit fees for foreign from $100 to $10,000.

A joint a statement issued by Labour, Interior and Finance ministries in Juba said the move was aimed at generating additional revenues to fill the gap in the 2016/ 2017 national budget.

The statement classified the work permit fees under: professional or business, $10,000, blue class workers, $2,000 and casual workers, $1,000.

The outbreak

The entry visa charge was also raised to $100 from $50. However, Kenyan and Uganda nationals will pay $50, but subject to renewal monthly.

South Sudan has been grappling with an economic crises occasioned by the outbreak of war in 2013.

There were fears that the new charges would attract retaliatory measures from other countries against South Sudanese.

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Museveni Dar visit rescues oil pipeline deal

Posted JULIUS BARIGABA in Kampala

on  Monday, March 6   2017 at  19:07

President Yoweri Museveni’s recent state visit to Tanzania was to rescue the crude oil pipeline project after Dar officials pushed to revise the low tariff that lured Uganda to prefer the southern route to the one through Kenya.

When President Museveni flew to Dar es Salaam on February 25 on the invitation of his counterpart John Pombe Magufuli to hold bilateral discussions, top on his list of priorities was the issue of harmonising the tariff that Uganda will pay for its oil to be transported through the port of Tanga in northern Tanzania.

Energy and Mineral Development Minister Irene Muloni was guarded, only saying that discussions between the presidents were around “issues of intergovernmental agreements to conclude” after “discussions with our partners about the incentive of the Tanzania route.”

But sources said the discussions in Dar es Salaam revolved around the tariff, and President Museveni returned to Kampala with a major victory after his visit ensured “the only impediment” that was still facing the $3.5 billion oil pipeline was removed.

Becoming stubborn

“The only impediment was Tanzania. The ministers were becoming stubborn, insisting that Tanzania should get more from this pipeline. The president flew there, put on his Museveni magic and got the issue out of the way,” he said.

The incentive that among other things lured Uganda to choose the southern route is the tariff of $12.2 per barrel of oil that Uganda will pay to move its crude oil through Tanzania, which Ms Muloni says was “the best we got”.

Faced with competing strategic alternative of building an oil pipeline through Kenya or Tanzania, Uganda had already endured delays as the oil companies — which are now partners in the country’s oil development plan — haggled over their preferred pipeline route.

This process eventually ended in Kampala with its partner oil companies Total E&P, China National Offshore Oil Corporation (CNOOC) and Tullow opting for the southern 1445km Hoima-Tanga route, ditching the northern Hoima-Lokichar-Lamu port route.

The EastAfrican has learnt that in a bid to hijack the deal from Kenya, which also discovered oil in the northern region, Tanzanian officials were willing to throw sweeteners into the deal, which included free land and a fair tariff.

Raising doubts

But, after getting the deal, Tanzanian officials started raising doubts over the project’s benefits to Dar es Salaam, citing a number of issues, such as the fact that in Tanzania land belongs to the government, so Uganda did not have to compensate any landowners, hence an increase in the tariff to a figure that The EastAfrican could not establish, was seen as a fair deal for Dar.

After the discussions, however, Tanzania relented and President Museveni welcomed the concessions offered by Dar to ensure that the pipeline project makes strategic and economic sense for both countries.

Upon President Museveni’s return from Dar, his presidential press unit released a statement touching on the five key issues that the Ugandan leader and his Tanzania counterpart discussed.

“We resolved that the key issues around this project have been resolved and we should ensure the contractor starts work,” the statement said.

Remains on course

With this, the Uganda government says it remains on course for the oil pipeline’s Front End Engineering Design (Feed) which is already ongoing, “to be completed in eight months”.

The Feed is conducted after completion of feasibility study, paving the way for the partners to hire engineers who will design the technical aspects and investment costs of producing a pipeline from the source to terminal.

The assistant commissioner in charge of pipelines development at the Directorate of Petroleum, John Bosco Habumugisha says the completion date for the Feed is August 2017.

Final cost

The feasibility study of the Tanga-Hoima route, which was undertaken by Gulf Interstate Engineering and handed to the Ministry of Energy and Mineral Development, put the cost of the pipeline at $3.5 billion.

The Feed works with the feasibility study estimate to arrive at the oil pipeline’s final cost, which Total, the main financier of the crude oil pipeline, will take to its financiers as the required amount for the project, paving the way for the procurement of the Engineering Procurement and Construction (EPC) contractor. 

Uganda is racing against time and fast-tracking its oil infrastructure projects in order to produce oil by 2020 — the crude oil pipeline, the oil refinery, an airport in the oil-rich Albertine region and other related infrastructure.

The 24-inch crude oil pipeline, which will deliver 200,000 barrels of crude oil per day, starts in the Lake Albert oil fields west of the country and terminates at Tanga port on the Tanzanian shores of the Indian Ocean.

Standard gauge railway

It is one of the key components being fast tracked to meet this timelines. The country discovered oil in 2006; its licensed areas have 5.4 billion barrels of crude out of the total discovery volume of 6.5 billion barrels to date. But experts say this amount is just a quarter of Uganda’s hydrocarbons.

Besides the pipeline project which was named the East Africa Crude Oil Pipeline, the two heads of state discussed joint electricity and power line projects Kikagati-Murungo, Nshongyezi-Nsongeza and Masaka-Mwanza.

Also on the agenda was the transport infrastructure, touching on the Malaba-Kampala standard gauge railway, which will connect to Tanzania through Bukasa Port, while Dar is building a dry port at Mwanza.

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Opec loses $1 trillion to dwindling oil prices

Posted MOHAMMED MOMOH in Abuja

on  Saturday, March 4   2017 at  11:33

The Organisation of Petroleum Exporting Countries (Opec) lost $1 trillion to dwindling oil prices between 2014 and 2016, official said.

Opec Secretary-General Mohammed Barkindo said the member countries could not earn about $1 trillion of oil revenue.

Dr Barkindo, said on a visit to Nigeria the industry further lost $1 trillion in terms of deferred projects and outright cancellation of projects across its entire value chain.

“We need consistent investments in order to maintain current production and take care of reserves and secure future supplies,” he said.

A joint supply

The Opec chief said it was agreed that non-members be invited to build a platform of 24 producing countries to agree on a joint supply, seeking to adjust about 1.8 million barrels a day.

“For the first time in history, we were able to build a platform of 24 producing countries within six months in order to address the stock overhang which has been the variable to the supply equation that had sent this market off balance since 2014.

“We are on the course to pulling this industry out of the worst recession. We have entered to restore stability to the market on a sustainable basis that will allow investments to come back on a continuous basis,” he said.

Remains a miracle

Dr Barkindo commended the Nigerian government for staying afloat during the price-crash, calling the period “the worst energy circle in recent memory’’.

“How you survived as a government and as institutions under this great industry remains a miracle.

“I visited all other countries and I have seen how they struggle but you have weathered the storm, I think the worst is behind us.’’

He said the agreements reached by the cartel and non-Opec members in Algiers and Vienna during their meetings in November and December 2016 were lifesaving measures as they had overcome market challenges.

The confidence

Dr Barkindo said he had to insist on reducing his entourage to Nigeria, because everyone was willing to come and see first-hand “giant strides’’.

He commended Nigeria’s Petroleum minister, Mr Ibe Kachikwu, for building the confidence of Opec members and earning their respect saying, “the minister was able to convince Opec member countries to drop their candidates for his candidate.

“That shows the level of respect they have for him, for him to have persuaded sovereign nations and say I have a better candidate.

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Dos Santos daughter to leave Angola state oil firm

Posted ARNALDO VIEIRA in Luanda

on  Saturday, March 4   2017 at  11:09

Isabel dos Santos, the daughter of Angolan President Jose Eduardo dos Santos, will leave state oil firm Sonangol before the August General Elections, media reported.

Portuguese newspaper, the Expresso, quoting an anonymous source from the Angolan ruling party, said the move was aimed at reducing the anti-dos Santos family sentiments.

“I will leave soon because I have been under immense pressure,” the Expresso reported Ms Isabel dos Santos saying in private.

The Expresso further said, the president's son, Mr Filomeno dos Santos, currently in charge of the sovereign fund, would also exit his post.

Board members

President dos Santos last June appointed Isabel, his eldest daughter, a non-executive director of Sonangol.

Filomeno de Sousa dos Santos (Zenú), 38, was in 2012 appointed one of three board members of Angola's new $5 billion sovereign wealth fund, the Fundo Soberano de Angola.

President dos Santos, 74, and his governing Popular Movement for the Liberation of Angola (MPLA), have been in power since 1979.

He is Africa's second longest-serving leader after Theodore Obiang' Nguema of Equatorial Guinea.

The richest woman

Twelve Angolan lawyers have challenged the appointment of the president's daughter as Sonangol director.

The lawyers have petition the Attorney-General's Office to annul the appointment for going against the public probity laws.

Ms dos Santos is Angola’s first billionaire and the richest woman in Africa with a net worth Forbes estimates at $3 billion.

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Nigeria plans $20bn Niger Delta gas park

Posted MOHAMMED MOMOH in Abuja

on  Tuesday, February 28   2017 at  14:42

Nigeria plans to establish $20 billion gas industrial park in the Niger Delta following a renewed engagement with the local communities.

Acting President Yemi Osinbajo unveiled the plan during a meeting with international investors for the project at the Presidential Villa in Abuja on Monday.

The Gas Revolution Industrial Park (GRIP) is envisaged to be a regional hub for all gas-based industries.

The public-private partnership project will cover 2,700 hectares.

Are unwavering

GRIP will also have fertiliser, methanol, petrochemicals and aluminium plants in the area already designated as a Tax Free Zone by the Federal Government.

Prof Osinbajo stated that the Buhari administration “is committed to the development of the Niger Delta, and the importance of this project is underlined by the presidential attention it is attracting’’.

“We already have a steering committee in place, chaired by Minister of State for Petroleum Resources, that shows the level of our commitment; we are unwavering.

“We take the project very seriously and glad to see you are committed and ready to make several other commitments," said Prof Osinbajo.

Global operators

Before he went to London on a medical vacation, President Buhari mandated Prof Osinbajo to visit the oil-producing communities, to demonstrate the resolve of the administration to the pursuit of a new vision for the Niger Delta.

The investing consortium comprise several companies including GSEC of South Korea, the China Development Bank, Power China and several other global operators from Asia and the United Arab Emirates.

The GRIP project is envisages generating some 250,000 direct and indirect jobs.

The park, originally conceived by the Nigeria National Petroleum Corporation (NNPC), is located about 60km from Warri, and about 1km from the operational base of Chevron Nigeria Ltd.