Pipeline construction
Pipeline construction
For this project to be realized, capital and technical input through EPC will be a catalyst (F + EPCM). The fuel separator in Ndola was established to produce Heavy Fuel Oil (HFO) to operate the mining refineries. With modernization of refining technology in the mines, there has been a shift in the purpose of the separator and it has been operating at 50% capacity due to revolution in the energy sector and there is need for a modern refinery to process petroleum products with less stress on the machinery. The project will operate under a Build Own, Operate and Transfer (BOOT) mechanism. A feasibility study will determine the actual project cost and the route to be taken to implement the project in a shortest possible time within two years. Supporting letters from the governments of Zambia and DRC for the project will be issued on request with accompanying profile of the investor and EPC contractor so as to lessen the time project commencement. There is a ullage constraint in Zambia and the Democratic Republic of Congo (DRC). Before erecting the pipeline storage facilities, there is need to erect fuel farm tanks with biofuels blending facilities to mitigate the global climate change which has become a global topical issue at political and economic fora. This enables the project to commence trading now and not after the completion of the project. Some four sites and Fuel farm tanks that need to be purchased and upgraded to 60,000MT are available in Zambia and DRC. Permits and licences will be issued upon purchasing them. This will need capital injection of Two hundred and Fifty Million United States dollars (US $ 250, 000,000.00).
Investment Attraction
Oracle Fuels and Logistics Limited
Zambia Development Agency offers Foreign Direct Investment incentives that protect the investor through signing of the Zambia Promotion and Protection Agreement (ZPPA). This guarantees the investor’s confidence that they will get their return on investment as per project duration. This is achieved through the involvement of the Zambian and Democratic Republic of Congo governments and the countries where the pipeline will pass by getting the necessary permits and titles for such an undertaking. In Zambia, the Industrial Development Corporation will assist in getting the necessary permits and licences. In DRC, the Ministries of Commerce, Lands and Energy will also assist in getting the required permits for such a noble investment as well as other countries the pipeline will pass through.
The project will line up from Beira in Mozambique, pass through Zambia to host a major refinery into Lubumbashi, DRC as the final destination for a distance of 1,600 km. Along the way, there will be pump stations.
The project goal is to reduce the fuel costs in the two countries of Southern part of DRC and Zambia whose cost of doing business is on the higher side as fuel or energy is the engine that drives the economy. Fuel is transported mainly by road and Indeni Petroleum in Ndola, Zambia, operates an obsolete separator, with less fuel coming through the rail line. This makes fuel very expensive. This is a must project for both countries.
The estimated cost of the project is Two billion, Five Hundred Million United States Dollars (US $ 2,500,000,000.00). To be revised upon fully carrying out the feasibility study.
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