This past week was action packed in matters business. Here at Kikubolane.com, we bring you a summary of some of the stories that made headlines.
Uganda, oil companies sign Final Investment Decision
The long awaited Final Investment Decision (FID) between government of Uganda and the international oil companies, French Total Energies and China’s Cnooc was signed early this week.
This paves way for Uganda’s oil project to head to the next development and construction phases, and subsequently starting of commercial oil production.
President Museveni officiated at the ceremony that was attended by Tanzania Vice President Dr Philip Mpango, who represented President Samia Hassan Suluhu. Eng. Irene Batebe, Permanent Secretary at the Ministry of Energy, who opened the series of speeches at the function held at Kololo Independence Grounds in Kampala, described the day as monumental in the history of the country.
The FID means launching Uganda’s oil project to the next development and construction phases, and starting of commercial oil production by 2025.
This means TotalEnergies will start construction on its Tilenga oil project in Nwoya and Buliisa districts.
The two oil companies, along with the Uganda National Oil Company (Unoc) and Tanzania through through its national oil company, TPDC, are shareholders in the proposed EACOP which will transport crude oil from the central point in Hoima to Tanga Port en route to the international market. The shareholding in the EACOP holding company is; Unoc with 15 percent, TotalEnergies East Africa Midstream B.V with 62 percent, Cnooc with 8 percent, and TPDC with 15 percent.
The capital expenditure for the 1,443km duct is estimated at $3.55b (shs13trillion), 70 percent of which will be raised from international lenders.
German bank KFW offers Shs875b capital to Ugandan startups
KFW and Indian based venture capitalists, Aavishkaar Capital announced a partnership to help Ugandan emerging mid-market businesses to excel in the global market, with a $250m (sh875.5b) fund.
Aavishkaar Group Chairman Vineet Rai said the fund will mainly offer capital to businesses by strengthening their environmental, social and governance (ESG) practice.
“The fund will seek to provide transformational capital which can be invested across the capital structure, helping businesses improve their ESG standards so that they can capitalize on the increasing consumer preference for ecologically-conscious, gender-equal and purpose-driven businesses and meet increasing demands on corporate due diligence in the course of regulatory measures in the European market,” he said at the launch of the fund.
URA registers Shs950b revenue shortfall in first half of 2021/22 financial year
Uganda Revenue Authority (URA) registered a revenue shortfall of UGX 951.32 billion in the first 6 months of the current 2021/22 financial year.
URA was given a revenue target, by the Ministry of Finance, Planning and Economic Development, of UGX 22.363.51 trillion which is 16.10% (UGX 3,100.51) higher than the actual revenue collection from the last financial year.
Addressing journalists in Kampala on Wednesday, 02 February 2022, John Musinguzi Rujoki, the URA Commissioner General, announced that the net revenue collections for the first 6 months of this FY 2021/22 were UGX 10.163.09 trillion against a target of UGX 11.063.90 trillion, representing 45.44% of the annual target.
“In this period, domestic tax revenue collections were UGX 6.229.62 trillion against a target of UGX 7.180.94 trillion, registering a shortfall of UGX 951.32 trillion, and performance of 86.75%,” he said.
dfcu Bank launches recovery fund for SMEs
dfcu Bank Uganda has launched a Small Business Recovery Fund that aims to offer a financial uplift to small businesses that have been adversely impacted by the COVID-19 pandemic.
Announcing the commencement of the fund on Tuesday, February 1, 2022, Ronald Kasasa, dfcu Bank’s Head of Business Banking said the Bank has been at the forefront of transforming businesses in Uganda by providing affordable and flexible financing solutions.
According to William Kayongo, the manager in charge of Enterprise Banking at dfcu Bank, the dfcu recovery fund is part of the bigger industry action spearheaded by Government of Uganda through Bank of Uganda.
Kayongo explained that through the fund, dfcu provides affordable credit facilities to small businesses that have suffered financial distress arising from the knock-on effects of COVID-19 pandemic. This fund provides the much-needed liquidity to resuscitate such businesses.
11 injured in fire explosion at Vivo Energy fuel depot in Kampala
Eleven people were injured after a fire explosion at Vivo Energy Uganda’s Kampala Depot located on 7th Street Industrial Area in Kampala on Wednesday.
Three of them were seriously injured and are admitted to the intensive care unit at International Hospital Kampala (IHK).
“Three of these are currently in intensive care, a further one is in the high dependency unit, and the remaining eight people are being treated for minor injuries,” Vivo Energy Uganda said in a statement.
The fire incident caused panic among staff in nearby offices such as Monitor Publications Ltd, with some forced to flee the building, thinking that it was a bomb,
Police Fire Brigade arrived quickly to put out the fire assisted by the Vivo Energy technical team.
Saudi Airlines commences direct flights from Riyadh to Entebbe
Saudi Airlines on Wednesday, 02 February 2022 commenced direct scheduled flights from Riyadh to Entebbe International Airport.
The maiden flight landed at Entebbe on Wednesday, and was welcomed with a traditional water salute.
Uganda’s Ambassador to Saudi Arabia Isaac Biruma Sebulime and Embassy officials attended the inaugural ceremony of flights between Riyadh, Saudi Arabia and Entebbe, Uganda at King Khalid International Airport Riyadh on 1/02/2022.
Mr Vianney Luggya, the spokesperson of the Uganda Civil Aviation Authority, said Saudi Airlines becomes one of the 17 international airlines to operate in Entebbe.
“Whenever a new operator comes, it is a vote of confidence in the country’s aviation systems. We expect that their coming on board will help us increase the passenger traffic that has been steadily grown through the years,” Mr Luggya told reporters.
This marks the beginning of two shifts per week between Entebbe International Airport and Riyadh’s King Khalid International Airport.
Fuel prices to normalise soon – Minister
The Minister of State for Energy and Mineral Development (Minerals), Hon Peter Lokeris, has reassured lawmakers that petroleum fuel prices are expected to return to normal by 10 February 2022.
In the week commencing 01 January 2022, the country experienced a hike in petroleum prices by Shs 550 from Shs 4,450 per litre as of 17 December 2021, to the current Shs 5,000 per litre.
“The high petrol pump prices of petroleum products are caused by product scarcity and once supply returns to normal prices will become competitive again,” said Lokeris.
He warned that in the event that the pump prices go beyond the acceptable levels, the Petroleum Supply Act under Section 30 empowers the minister to take action on the errant operators.
“The action can constitute closure of petrol stations, issuance of penalties or revocation of licenses in extreme cases,” said Lokeris.
He was presenting a statement on the supply and escalating petroleum prices during plenary sitting on Thursday, 03 February 2022.
The minister explained that the reduction in stock levels and the resultant stock out of petrol in the country was caused by the COVID-19 spread control measures the Ministry of Health introduced that required all truck drivers to be tested.
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