Uganda Goes To The Market in 2013 - Africa’s premier report on the oil, gas and energy landscape.

Uganda Goes To The Market in 2013

The Ugandan government is planning a bid round of more than 10hydrocarbon tracts in the Albertine Rift Basin in 2013, once the current ban on licensing of new acreage is lifted.

At least 14,000 square kilometres – roughly 60% of the basin – remain unlicensed, according to the ministry of Energy and Mineral Development performance report 2011/2012.

A total of 17 oil blocks were demarcated in the basin. Four of the blocks were awarded before Uganda imposed a licensing ban on new acreage in 2007. The remaining blocks will be auctioned as soon as President YoweriMuseveni enacts a new law lifting the licensing ban.

Uganda’s parliament finally passed two new hydrocarbon laws, in late December 2012, thatmay clear the way for lifting of ban on lease sale. The Petroleum (Exploration, Development, Production) Bill and Petroleum (Refining, Gas Processing, Conversion, Transportation and Storage) Bill were introduced in parliament in February 2012 to give legal effect to the national oil and gas policy that was approved in 2008.

Among those companies that have expressed interest in buying exploration tracts are some indigenous Ugandan firms, including Nile Valley Oil Exploration Plc,Intex Construction, Asker Investments Ltd, Canaan Investments Ltd and TRC Group.

Of the foreign companies keen on a slice of the Ugandan hydrocarbon property, the list includes China Petroleum Engineering and Construction Company (China), Rapid African Energy (South Africa), Sinopec (China), Marubeni (Japan), Pet Oil (Turkey), Turner And Townsend (South Africa), Whitanker Group (USA), Bain and Company (USA, India), Trans-Oceanic Projects and Developments (Kenya) and Toyota (Kenya). But the really big names that are known to have expressed interest include Italy’s Eni, Russia’s Lukoil Holdings, and India’s Essar Oil Ltd.

British explorer Tullow Oil, French major TOTAL and Chinese behemoth CNOOC are the three main players in the country. They are all planning to invest around $10-12 billion to develop oil fields in four blocks as Uganda continues plans to join the ranks of African oil producers. They have submitted a plan of development, since July 2012, which the government is considering. First oil is expected around early 2018. Ugandan authorities say that oil companies operating in the basin have had a success rate of around 87%, finding oil in 76 oil wells out of the 87 wells drilled so far. In the five years since the acreage licencing ban has been in place, some of the blocks previously licensed to oil companies have been returned to government through relinquishment requirements and the expiry of licenses.

A 2013 licensing round will be Uganda’s first since it imposed the ban in 2007, which was put in place following the confirmation of commercial oil reserves.


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