Uganda to process 1b barrels of oil only
Friday, 17 February 2012 | 00:00
Oil sector experts have cautioned Ugandans to be mindful of the fact that only 45% to 50% of the country’s total oil potential can be successfully extracted given the sandy nature of rocks in the oil-rich Albertine Graben.
Robert Kesande, an assistant commissioner in the ministry of energy noted that only 1b barrels of oil can be evacuated from the ground given the fragile nature of the rocks, adding that further discoveries of oil deposits cannot be ruled out.
“Based on the existing technology, we cannot bring all 2.5b barrels of the oil underground to the surface due to the nature of the rocks. After a rigorous process, we expect to bring out close to 45% or 50% of the total oil deposits.
“It is possible that additional oil deposits may be discovered going forward,” he explained.
Kesande made the remarks at the Uganda Revenue Authority (URA) public dialogue on the oil sector at the Kampala Serena Hotel on the topic “Black Gold in Uganda-Matching Expectations with opportunities.”
Reports indicate that the oil-rich Albertine Graben consists predominantly of sandstones, siltstones, clay-stones and shales of high porosity and permeability that necessitates the use of expert production procedures.
At the dialogue, Simon D’junga, the state energy minister pointed out that oil revenue will primarily be used for infrastructure development in order for every Ugandan to benefit. He further noted that the sector should not overshadow developments in other crucial sectors in the country’s development curve.
“We are set to table a motion in Parliament for oil sector workers to receive higher salaries outside the existing wage structures so as retain them. The world is interconnected and so developments here can affect the New York stock markets and vice versa,” he said.
D’junga added that vital sections of the oil agreements that hold expensive-to-attain data have been deliberately concealed to protect the country and related stakeholders and that only general information like royalties shall be disclosed.
Visiting Nigerian scholar, Ajee Danladi Mamman pointed out that the country needs to quickly secure investors for the Katwe salt mines, adding that chlorine, a by-product is vital in the oil sector.
“Having the right qualifications does not guarantee competency. When Uganda gets qualified nationals in the oil sector, they start off as apprentices in order to attain the required experience and skill to drive the sector forward,” he noted.
Thomas Richardson, the IMF senior representative to Uganda said that there is little chance for the country to catch the “Dutch disease” where extreme levels of poverty coincide with abundant oil wealth due to the current public scrutiny and interest in the oil sector.
Elly Karuhanga, the Tullow Africa chairman and Chamber of mines boss decried the slow pace of government approvals of oil sector business and felt that it is hurting the sector and pilling up needless expenses for sector companies.
The Irish oil exploration firm is due to list shares on the local stock exchange after pertinent modalities are put to bed following the recent renewal of their operational licenses.
Source: New Vision
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