Uganda and Kenya meet over oil line extension

Jul 14, 2006 02:00 AM

Uganda and Kenyan government officials are meeting to iron out controversies on the proposed $ 110 mm Uganda-Kenya oil pipeline extension construction project.
In Kampala, legislators are querying the bidding process, saying the Joint Coordinating Committee of officials from Uganda and Kenya flouted and abused the procurement process. They said the committee acted contrary to the procurement laws and regulations.

Henry Banyenzaki, Rubanda West Member of Parliament (MP) queried the project during the House Finance Committee meeting, who said the project was irregular and needed to be revisited as some bidders were not satisfied with the process.
But when brought to Parliament by James Kakooza, the Kabula MP, the matter did not take off because, according to Rebecca Kadaga, the Deputy Speaker of Parliament was in need of more consultation.

A petition by East African Petronet Consortium, one of the bidders queried the law under which the Joint Coordinating Committee, a creation of the memorandum of understanding between the governments of Uganda and Kenya, was established. They said the pipeline extension is a public procurement, which ought to be subjected to the existing procurement laws and regulations, short of which the process is open to abuse.
There were four final bidders namely China Petroleum Pipeline Engineering Corporation, Tamoil, Petronet and Misa/Shell. Tamoil emerged the best in a move contested by the other bidders.

In a letter to the Kenyan Minister of Energy, and Uganda's former Energy Minister Syda Bbumba, argued that the pipeline being an expensive inter-territorial and urgently needed project in Uganda, it was important to ensure smoothness through the process to avoid unnecessary drawbacks. She advised that all pre-qualified companies be subjected to the same rules, and that in order to correct the irregularities, the opening of the financial bids be halted until the needful was done.
She called on the Permanent Secretaries in the ministries of energy in the two countries, who are joint chairmen of JCC to clear the allegations.

In May 2006, completion of the tender process for the extension of the oil pipeline was suspended until the petition against the process is dropped. Construction of the 320-km oil pipeline, which is supposed to be operational by late 2007, is supposed to start in August this year. However, the process has been beset by hiccups due to the dual country nature of the project.
When complete, Uganda expects to save much on the costs it incurs on transporting oil from the Kenyan oil refineries on road.

Source: Xinhua
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