The Government of Uganda highlighted to investors a three-tiered range of opportunities for profitable and transformative engagement
At the African Energy Week, the continent’s leading networking and business stimulation summit this year hosted in Cape Town, South Africa, details were given of commercial opportunities in the strategic East African hub nation, and how it is about to undergo a boom in the oil and gas sector.
Entitled `Invest in Uganda Energies’, the roundtable event was led by Irene Batebe, the permanent secretary at the country’s Ministry of Energy and Mineral Development, supported by representatives from the government-owned Uganda National Oil Company (UNOC) and the regulator, Petroleum Authority of Uganda (PAU).
After almost 20 years of prospecting, planning, investing, engineering and construction, Uganda is on track to start pumping its first oil and gas in 2025, with two already licensed development and production areas forecast to produce 230,000 bopd. Earnings from the new oil and gas sector will drive the country’s zeal to meet global environmental targets.
Batebe shared, "Our energy transition plan strategically exploits petroleum revenues for investments in renewable sources, aligning with ESG (Environmental, Social, and Governance) standards."
Ali Ssekatawa, director for legal and corporate affairs at PAU said, "To provide confidence to the investor we have worked for several years to set up a rigorous legal and regulatory framework specifically designed to boost both investor confidence and future tax revenues that will allow Uganda to drive its development agenda. That framework is now in place. Uganda offers a world-class business environment for investors.’’
The three-tiered investment opportunity strategy laid out covers:
a) Profitable opportunities to become involved in the blocks already licensed for production and the major infrastructure projects associated with opening up Uganda’s oil and gas frontier. These range from the strategic level, such as involvement with the planned 60,000 barrels a day refinery which will revolutionise petrol availability and pricing not just in Uganda but regionally, to the tactical level, such as catering, accommodation and logistics.
b) Joint venture and partnership on the next blocks that will be developed in the same geological space as the existing blocks. For example, UNOC has won the competitive round to explore in one of these new blocks and with survey data returning highly favourable figures the company would entertain partnership approaches from established majors in the oil and gas production industry.
c) Opportunities in entirely new geological spaces within Uganda, basins in the centre and the east of the country where early prospecting work indicates deposits just as rich as the area where the two blocks have been licensed for production. It is expected that a round of competitive tendering for these new areas will be launched as soon as mid-2024.
Proscovia Nabbanja, CEO, UNOC, revealed, “Our investments in the oil and gas infrastructure across the entire petroleum chain stands as a testament to our commitment to contributing to economic transformation, innovation and excellence.”
Uganda’s oil and gas revolution has so far been focused on the far west of the country, close to its frontier with the Democratic Republic of the Congo, around Lake Albert. The area has long been known for its unique geology, the lake formed as a small section of the western branch of the Great Rift Valley, a tear in the earth’s surface that runs 4,000 kms from Lebanon in the Middle East in a southerly direction through Africa.
Locals have long reported what are known as 'surface manifestations' around Lake Albert, with soil darkened by oil seepage from deep underground, sheen on small bodies of water and occasional sulphurous odours associated with oil.
But it was not until 2006 that the first commercial quantities of oil and gas were confirmed by industry surveyors in what is known to geologists as the Albertine Graben, a large area that includes the lake as well as a large slice of land buffering the lake that runs roughly north south as part of the western rift.
The two areas already licenced for development and production are mostly on land, although some of the reservoirs extend underneath Lake Albert. Drilling work there will be done either from rigs on the shore using lateral drill techniques that stretch out under the relatively shallow waters of Lake Albert or traditional offshore rigs.
"You will note that only 10% of the Albertine Graben of Uganda is licensed for petroleum development and other potential basins are also under consideration. Investors are welcome to invest in Uganda’s oil and gas sector," President YoweriMuseveni said at the event.