{UAH} America warns Uganda on oil refinery deal to Russia

America warns Uganda on oil refinery deal to Russia

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By FREDERIC MUSISI

Posted  Sunday, March 1   2015 at  02:00

IN SUMMARY

The refinery project manager Robert Kasande told Sunday Monitor that they are cognizant of the sanctions against Sergei Chemezov but added that these are issues he cannot comment about or are rather beyond him

KAMPALA.

The US Ambassador to Uganda Scott DeLisi last week expressed disapproval of the awarding of $4b (about Shs11.5 trillion) oil refinery project to the subsidiary of a Russian state conglomerate that also deals in arms and whose chief executive is under heavy US and EU sanctions. He warned that this venture is "not a done deal."

"On the issue of the sanctions, these are issues I am sure the government will have to look at carefully. They have designated a Russian company as the first on the list, absolutely, but they still have to negotiate a variety of issues that will go to financing and the rest. I would suggest that you wait and see how that all plays out,"

DeLisi was speaking during a 45-minute interface with selected journalists at the US embassy in Nsambya, Kampala, on Wednesday.
"They [problems] maybe because of the sanctions imposed upon the parent company.

"There may be problems in terms of financing, inability to operate but we will see how all that plays out," he added.

Last week, the Uganda government awarded the contract for the refinery project to RT Global Resources, a consortium managed by Russia's Rostec, a defence and technology corporation whose businesses include manufacturing and selling weapons such as the AK-47/Kalashnikov rifles.

In 2013, the government started the search process for a lead investor to undertake construction of the 60,000 barrels-per-day (bpd) oil refinery. About 75 companies picked the Request for Qualification documents and only eight made it to the last submission round. Later, four companies pulled out for diverse reasons.

The four that reached the last round included, RT Global Resources, Japan's Maruben Corporation, China's Petroleum Pipeline Bureau (CPPB), and the South Korean SK Group.

Mr Sergei Chemezov, Rostec's chief executive, is a former officer in the Russian spy agency KGB and close ally of President Vladimir Putin. He has US sanctions on him, which include freezing his assets and barring US companies from dealing with him since 2014.

The sanctions are in response to Russia's annexation and military adventures in Ukraine.
"It is not my job to tell the government of Uganda with whom they can engage but it is my job to share with the government the US policy, its concerns if there is any and to define the nature of our partnership. So that is what we focus on, but I wish them well even in other dealings but we will see how that all plays out," said Ambassador Mr DeLisi

The refinery project manager Robert Kasande told Sunday Monitor that they are cognizant of the sanctions against Sergei Chemezov but added that these are issues he cannot comment about or are rather beyond him.

He however revealed that they finalised the issues of financing with the Russian company.
President Museveni has in the recent past scolded Western countries for what he called arrogance, and said China and Russia were available as alternatives because they do not meddle in internal politics of other countries.

musisif@ug.nationmedia.com

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Gwokto La'Kitgum

"Even a small dog can piss on a tall Building", Jim Hightower

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