Uganda’s Oil Grows Marginally
The amount of oil Uganda can recover has grown marginally in 2014, according to Ernest Rubondo, the Commissioner, Petroleum Exploration and Production Department (PEPD). Uganda now boasts of 1.4 billion barrels of oil that is recoverable, up from 1.2 billion barrels.
This, even after the available oil in the ground grew by 85percent to 6.5 billion barrels. The amount recoverable means the oil Uganda can sell commercially and extract from the ground.
This means that of all discovered oil at the moment, only 21.5 percent of that can be recovered down from 30 percent.
Rubondo described the increased reserves as an achievement for Uganda, noting that “recoverable resources have potential to increase,” with the improving technology that can be deployed by oil companies, Total, CNOOC and Tullow.
These latest figures are as a result of new data submitted by the oil companies in their applications to start production.
Since Uganda made commercial oil discoveries in 2006, the amount extractable has been growing, together with the expectations of Ugandans. Currently there are no new licenses for companies to hunt for more oil as only 40 percent of the Albertine region has been explored.
Rubondo says that “additional exploration and appraisal is expected to be undertaken in the country.” He adds that this could lead to additional resources being discovered in the country, hence prolonging the production period for the country.”
Projections on when Uganda could start production are now expected to be in 2017, if the oil refinery in Buseruka Sub County, Hoima District is completed.
Currently, there are two consortia in the race to be the lead investor in the refinery. One of RT Resources from Russia and SK Energy from South Korea could be announced as the winning bidder by end of September 2014.
Notably, only one production license has been issued to CNOOC for the Kingfisher fields along the shores of Lake Albert. Tullow and Total have also submitted applications, which currently await approval from the government.
The potential of the current oil discoveries is expected to generate returns of up to 50 million United States Dollars, according to Tullow Oil.