No Drivers, Craftsmen for Oil and Gas

Oil rig at Kingfisher well

Blamed for being secretive, experts argue that the industry will need up to 2000 trucks at peak time of the project, which are not readily available in the country at the moment. Experts reveal that a new truck costs above US$100,000 dollars (Approximately 260million).

Although requiring some level of theoretical background than drivers and craftsmen, the study reveals a major shortage of mechanical technicians needed by the oil industry.

Considered as a sector with immense potential to transform Uganda’s economy through oil revenues, direct and indirect jobs, as well as doing business through supply of goods and services, the survey reveals that the oil and gas industry requires the country to embark on serious work to raise capacity and quality so as to match its standards.

The survey is titled: “Planning for the Future and Promoting National Content, A survey to foster opportunities  for Ugandans in the Oil and Gas sector.’ and was conducted by Schlumberger Consulting, one of the major oil industry logistics suppliers.

The survey has further established that Uganda faces a potential shortage of geoscientists, petroleum engineers, and welders, as well as electrical technicians.

Of the 25 sectors surveyed, only about four were found to have the right or estimable quality and quantities needed by the oil companies. These are cement manufacturing, facility management, catering and security services.

The survey revealed that sectors such as domestic waste management, fuel wholesale, bulk construction materials and domestic airline services meet the standards but fall short of the needed quantities.

The survey comes against a background of discontent and suspicion among local suppliers that oil companies are presenting excuses to the government such as poor quality goods or absence of relevant skills on the local market to import labour and goods including food stuffs.

At peak time of refinery and oil well construction, expected in about 3 to 5 years from now, the oil and gas industry is expected to employ 13000 direct jobs. However, experts reveal that many of the available skills need to be upgraded and certified.

The survey has called for the establishment of a certification process for qualifications in all relevant disciplines, accompanied with an accreditation to enable them work on an oilfield site.

Emmanuel Mugarura, the Chairman of the Association of Uganda Oil and Gas Services (AUOGS) argues for example that oil and gas companies are not transparent enough in their dealings. He noted for example, that oil companies have evaded questions from local suppliers regarding which goods and services they need and of which quality.

Mugarura’s concerns were captured by the survey itself noting that majority of local industrialists and service providers are frustrated at the lack of information on future project demands in the oil sector.

To counter this challenge, the oil companies have proposed the creation of an Enterprise Enhancement Centre to assist suppliers get ready for the construction and prepare the after-peak.

The proposed centre, suggested to be located in Kampala, would raise the management standards of Ugandan companies to ease their participation at the construction phase and anticipate the post-peak period, by transferring workers and supplies to other sectors or regions.

In addition, the report notes that: “The enterprise enhancement centre would provide training including how to respond to tenders, understanding the general terms and conditions of an international contract, or the mandatory safety and environment standards of oil and gas operations.

On their part, the oil companies have pledged to bridge information gap by communicating better through regular meetings with local service providers, regarding future demand for equipment and raw materials and project timelines.

The industry players have also pledged to establish a dedicated website to update demand levels and project timelines when required.

Regarding skills, the report has urges the government and oil companies to support vocational and related technical institutions, including financing equipment for practical training.

A National Suppliers Database as well as National Talents Register, have also been proposed as a relevant tool to help in sourcing qualified personnel.

But besides the direct and indirect jobs, improving quality of Ugandan workforce, would greatly benefit the local industries after the peak of the sector. Up to 150,000 jobs majority of which will be indirect or induced jobs such as hotel workers, drivers, or air hostesses are expected to be created.

Increasing local content or participation is considered one of the best ways a country can benefit from oil and gas resources. Earnings from local participation, experts say, can be greater than sheer revenues from sale of oil.

Nigeria recently passed a law promoting local participation, which is accredited for turning around the country’s oil and gas sector.

Governance is also considered as a major factor in promoting and safeguarding local content.

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