Tororo fertiliser factory now resumes operations

The Shs2.2 trillion Sukulu phosphate and fertiliser factory in Tororo District, Bukedi Sub-region, has resumed partial operations, two years after it shut down.

The factory shut down in 2021 after it reportedly lost funding from the Industrial and Commercial Bank of China.

The Chief Executive Officer of Guangzhou Dongsong Energy Group Company, Ms Jane Guo, said the partial production has started with the fertiliser section.

She made the remarks while addressing a Cabinet subcommittee that was led by the Minister of Energy and Mineral Development, Ms Ruth Nankabirwa, at the weekend. 

“We did a feasibility study on which section to begin with and we discovered that fertiliser prices had tripled in the market and this guided us to start with the fertiliser section,” she said.

Ms Guo informed the Cabinet subcommittee that they will also consider resuming production in all other sectors but in a phased manner supported with availability of funds.

“We also hope the proceeds from sale of fertilisers will help us revamp other sectors with time,” she said, adding that the government should also allow them to go into full production.

Sitting on 625 acres of land, the factory is supposed to produce 300,000 tonnes of organic fertiliser, steel, electricity, sulphuric acid and glass.

In March this year, the government announced plans to revamp the multimillion China-Uganda Free Zone Industrial Complex at Osukuru in bid to create jobs.

“The country is in great need of fertilisers and halting its production equally hurts the government but we will commence production as we outsource for other potential investors,” Prime Minister, Ms Robinah Nabbanja, said while announcing the revamp.

President Museveni commissioned the factory in 2018 but along the way, the main shareholders of the project, LV Weidong and Min, allegedly developed a disagreement that resulted in a legal battle.

In 2020, businesswoman Fang Min reportedly filed a case in which she had accused Guangzhou DongSong Energy Group together with Uganda Hui Neng Mining, Mao Jie and Yang Junjia of fraudulent and unlawful expropriation of a 26-square-kilometre mineral site in Osukulu Sub-county in Tororo District.

A costly legal battle that resulted in compensation of $12m (about Shs42b) thereafter stalled the project.

Ms Nankabirwa, while touring the factory, said resuming production mainly on the fertilizer section is timely. She added that this will help boost the Parish Development Model programme since the beneficiaries are into agriculture. 

“Use of fertilisers is currently not an option but a must because the fertility of our land has gone down and it’s the reason why most farmers are experiencing low production. As a country, we are saying use of fertiliser must be a priority,” Minister Nankabirwa said.

She added that the government will also consider phased financing to help the investment resume full production.

Meanwhile, the Minister of State for Finance and Investment, Mr Amos Lugolobi, challenged the investor to identify critical areas where they feel the government can partner with them to help rejuvenate production.

“The shut down of this investment had brought shame to the government since it had a lot of hope in this investment,” he said. 

Mr Jacob Oboth Oboth, the Minister of State for Defence, said: “We applaud the investor for sparing its resources to revamp this investment because when it closed down, we were all affected,” Mr Oboth Oboth said.