LNG and energy engineer McDermott and Sinopec unit chosen to bring Uganda oil and gas on stream

Thursday, 10 June 2021
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McDermott International, the US energy and LNG engineering firm, and China’s Sinopec International Petroleum Service Corp, have received the conditional award of a $2-billion contract from France’s TotalEnergies to give the East African nation of Uganda oil and natural gas output.

The McDermott-Sinopec Services consortium received a Letter of Award for the contract for the Tilenga project located in the onshore Lake Albert Basin of Uganda.

Tilenga joint venture is the center-piece of an oil and gas development effort to bring investments of over $10Bln to Uganda and neighbouring Tanzania.

The Tilenga venture currently includes six oil fields and will feature 426 oil wells at full production.

“The projects for the development of the oil and gas resources of the Lake Albert region and a cross-border pipeline are situated in a sensitive social and environmental context that requires special measures for the environment and the rights of the local communities,” explained TotalEnergies.

The Lake Albert region in Uganda has major oil and gas resources, estimated at over one billion barrels of oil equivalent.

Uganda has chsoen to develop them under the Tilenga project, operated by TotalEnergies and with the participation of China National Offshore Oil Corp. and the Uganda National Oil Company.

Production will be delivered to the Tanzanian port of Tanga by a cross-border pipeline, built and operated by the East African Crude Oil Pipeline (EACOP) company.

“This important step further strengthens years of successful collaboration with TotalEnergies on a wide portfolio of world-class projects in the Offshore, Petrochemicals and LNG segments, where TotalEnergies is a major stakeholder,” explained Samik Mukherjee, McDermott's Group Senior Vice President for Projects.

The Tilenga project will be led from McDermott's UK offices located west of London and Sinopec's office in Yangzhou in China's Jiangsu province, north of the Yangtze River.

The consortium will provide engineering, procurement, construction and commissioning (EPCC) services for the development of an onshore oil field that will generate up to 200,000 barrels per day.

It will consist of 31 well pads connected to a central processing facility (CPF) via buried flowlines.

McDermott said that work was set to begin soon and first oil was expected to come on stream in 2025.

“This is a momentous and essential project for Uganda for the development of its national companies and citizens, and as we continue to grow our footprint in Africa, we are committed to expanding local content opportunities in the communities in which we operate,” stated Tareq Kawash, a Senior McDermott Vice President for operations outside the US,

“This is a first step which allows launching the detailed engineering and procurement activities before the final approval by the partners,” Kawash added.

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