{"id":66278,"date":"2024-02-04T18:08:38","date_gmt":"2024-02-04T18:08:38","guid":{"rendered":"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan"},"modified":"2024-02-04T18:35:52","modified_gmt":"2024-02-04T18:35:52","slug":"museveni-bets-on-samia-to-save-oil-plan","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan","title":{"rendered":"Museveni bets on Samia to save oil plan"},"content":{"rendered":"<p><span style=\"color: #ff6600\"><strong>Africa-Press &#8211; Uganda. <\/strong><\/span><b>Uganda\u2019s President Yoweri Museveni appears to be running out of patience in the quest for a port of call for the country\u2019s petroleum imports, after political and legal setbacks in Kenya frustrated Kampala\u2019s efforts to use the port of Mombasa and its oil-related infrastructure.<\/b><\/p>\n<p>The Ugandan leader has now gone full throttle on plans to make the port of Dar es Salaam an alternative through which to deliver fuel to his landlocked country, with sources in Nairobi indicating that the earlier initiated talks have hit a brick wall.<\/p>\n<p>Uganda is, therefore, looking at a second month without actualising its multimillion-dollar fuel importation deal between state-owned Uganda National Oil Company (Unoc) and Swiss commodity and trading giant Vitol to supply petroleum products to at least 170 oil marketing companies in Uganda.<\/p>\n<p>This week, a technical team was dispatched to Tanzania \u2014 the second trip in three weeks \u2014 to negotiate the finer details in the delicate petroleum importation deal through Dar es Salaam that Tanzania President Samia Suluhu Hassan offered to potentially beat the Mombasa Port as the preferred route.<\/p>\n<p>According to sources familiar with the matter, the discussions are led by envoys appointed by Presidents Museveni and Samia. The Ugandan envoy met with President Samia first to present \u201cthe urgency of the issue that can\u2019t rely on vested interests in Kenya.\u201d<\/p>\n<p>Energy Minister Ruth Nankabirwa told The EastAfrican this week that it was too early to establish the timelines when Unoc can get the green light to land the first fuel cargo in Dar es Salaam, adding that \u201ceverything is still under negotiation.\u201d<\/p>\n<p>Technical teams from Kampala and the Tanzanian commercial capital are thrashing out details on tax waivers that Tanzania has proposed to offer, the volumes to be shipped, and the mode of transport.<\/p>\n<p>\u201cThere has been one meeting already in Tanzania. The technical team is right now preparing to travel to Tanzania for a second meeting,\u201d she said, expressing frustration about the setbacks in Kenya, which have left Uganda with no choice but to pursue alternative routes as long as they will \u201censure security of supply.\u201d<\/p>\n<p>Although Ms Nankabirwa was cagey about how much fuel Kampala plans to bring in through Dar es Salaam, it is understood that one of the issues on the negotiation table is to import about two billion litres of petroleum products through Tanzania, which is about 80 percent Uganda\u2019s consumption.<\/p>\n<p>This, experts say, is a shift from the plan at the outset last year, when the government pushed for the bigger percentage of imports to come through Mombasa, as Dar es Salaam was riddled with multiple infrastructure challenges, including the lack of a refined products oil pipeline and an efficient railway transport system.<\/p>\n<p>\u201cThe volumes we import through Tanzania will depend on the [tax] waivers they offer. We cannot talk about volumes now. We are still negotiating,\u201d Ms Nankabirwa told The EastAfrican.<\/p>\n<p>With the bigger percentage of Kampala-bound petroleum products coming through Tanzania, this would swell Uganda\u2019s cargo traffic through the Dar es Salaam port, which currently stands at only two percent of the facility\u2019s throughput, according to Tanzania Ports Authority (TPA).<\/p>\n<p>Although still under discussion, all indications are that Dar es Salaam is offering a better deal, consistent with the incentives and offers it has been giving its new customers, including a 30-day free storage for Ugandan shippers for all imports, and a dedicated goods shed at the port, which can be used as a consolidation and deconsolidation centre any time, TPA deputy director-general Juma Kijavara, said last week.<\/p>\n<p>By contract, Mombasa port offers only 15-days free storage.<\/p>\n<p>The other discussions touch on challenges along the Central Corridor and requirements that need to be in place to facilitate smooth delivery of imports to Uganda, to be worked out by the government of Tanzania on how to optimise infrastructure there.<\/p>\n<p>According to the Ministry of Energy data, Uganda predominantly imports its petroleum \u2014 over 90 percent \u2014 through Mombasa, supplemented by imports via Dar es Salaam. Last year, the country\u2019s petroleum consumption reached 2.5 billion litres, with a $2 billion import bill.<\/p>\n<p>Mid last year, Uganda\u2019s Cabinet approved a plan that mandated Unoc to directly import fuel into the country, with a view to reducing inefficiencies and do away with what President Museveni described as arrangements in Kenya that were designed to cheat Uganda-based oil companies, leading to high pump prices in the market.<\/p>\n<p>President Museveni said for a long time, officials in his government colluded with cartels in Kenya that purchased from refineries in the Middle East under the Open Tender System and, even when Kenya ditched OTS and switched to a government-to-government (G2G) arrangement with the United Arab Emirates in March 2023, the fuel still came at high premiums and was priced out of Ugandans\u2019 reach.<\/p>\n<p>Dicksons Kateshumbwa, a legislator and former commissioner for Customs at Uganda Revenue Authority, said under the G2G system, Gulf refineries supply all fuel to countries in the region \u2014 including Uganda \u2014 at premiums of $118 per metric tonne for Automotive Gas Oil and $97.5 per metric tonne for Premium Motor Spirit as opposed to $35 per MT under the OTS.<\/p>\n<p>Kenya negotiated a six-month credit period in which it would get oil and pay the Gulf companies after supply, but forced Ugandan OMCs to pay upfront for petroleum products to cushion Kenya\u2019s forex crunch.<\/p>\n<p>Uganda amended its Petroleum Supply Act to hand Unoc the powers to partner with Vitol and import directly from the Gulf refineries, and the state-owned firm was set to commence the importation in January 2024 but, due to a lawsuit challenging its application for a licence to transport fuel products in Kenya, this was not achieved.<\/p>\n<p>On December 28, 2023, Uganda escalated the dispute to the East Africa Court of Justice, where a ruling is pending, while for the case in Kenya challenging Unoc\u2019s application to run fuel logistics business, a court case in Machakos, on January 22, 2024 deferred its ruling to February 12.<\/p>\n<p>However, the Uganda government drafted a law that would create a sole supplier of all OMCs, knocking out Kenya\u2019s push to maintain its dominance of fuel supply, and authorities in Kampala cannot determine how soon the falling-out over this deal can be resolved to allow Unoc to start importing fuel via Mombasa.<\/p>\n<p>According to Ms Nankabirwa, Kenya\u2019s President William Ruto was in full support of Uganda\u2019s move to import petroleum products from source, until the country\u2019s economic interests became threatened at the expense of regional cooperation.<\/p>\n<p>\u201cI don\u2019t know where all this frustration is coming from,\u201d Ms Nankabirwa told journalists in Kampala.<\/p>\n<p>\u201cThe president sent me to meet President Ruto four times and he was so supportive on all the times. Then he sent me, my brother [Petroleum minister Davis] Chirchir, and then some people jumped in court. What do you do if you are sued?\u201d<\/p>\n<p>Meanwhile, the communication channels between Kampala and Nairobi have have collapsed. Sources say that President Ruto is looking for a high-profile envoy to take a message to Museveni. But the Ugandan leader is desperate to salvage his Unoc-Vitol deal, so he may not reverse his decision.<\/p>\n<p><strong>For More News And Analysis About <a href=\"https:\/\/www.africa-press.net\/uganda\">Uganda<\/a> Follow <a href=\"https:\/\/www.africa-press.net\/\">Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Africa-Press &#8211; Uganda. Uganda\u2019s President Yoweri Museveni appears to be running out of patience in the quest for a port of call for the country\u2019s petroleum imports, after political and legal setbacks in Kenya frustrated Kampala\u2019s efforts to use the port of Mombasa and its oil-related infrastructure. The Ugandan leader has now gone full throttle [&hellip;]<\/p>\n","protected":false},"author":84,"featured_media":66277,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,7,12,258],"tags":[233,240,234],"class_list":["post-66278","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-head-lines","category-policy","category-to-homepage","tag-africa-press","tag-africa-press-uganda","tag-uganda"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.1 (Yoast SEO v27.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Museveni bets on Samia to save oil plan - Uganda<\/title>\n<meta name=\"description\" content=\"Uganda\u2019s President Yoweri Museveni appears to be running out of patience in the quest for a port of call for the coun ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Museveni bets on Samia to save oil plan\" \/>\n<meta property=\"og:description\" content=\"Uganda\u2019s President Yoweri Museveni appears to be running out of patience in the quest for a port of call for the coun ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\" \/>\n<meta property=\"og:site_name\" content=\"Uganda\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-02-04T18:08:38+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-02-04T18:35:52+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2024\/02\/sm_1707058862.69863.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"720\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Museveni bets on Samia to save oil plan\",\"datePublished\":\"2024-02-04T18:08:38+00:00\",\"dateModified\":\"2024-02-04T18:35:52+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\"},\"wordCount\":1204,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2024\/02\/sm_1707058862.69863.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Uganda\",\"uganda\"],\"articleSection\":[\"all news\",\"head lines\",\"policy\",\"to-homepage\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\",\"url\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/museveni-bets-on-samia-to-save-oil-plan\",\"name\":\"Museveni bets on Samia to save oil plan - 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