Uganda’s oil sector issues
President Yoweri Kaguta Museveni to meet the UN General Assembly to resolve Uganda’s oil sector issues. File Photo

President Yoweri Kaguta Museveni has vowed to settle the current Uganda’s oil sector issues

Speaking at the fifth oil and gas summit held at Serena Hotel in Kampala yesterday on Wednesday evening, President Museveni said that he expects to resolve the issues surrounding Uganda’s oil sector.

In his message to the delegates, Museveni also said that he is in touch with the executives of oil companies and he expects to have a meeting with the UN General Assembly to discuss the matter and come up with a way forward.

“I was supposed to meet them in New York, but I had more important issues to do here. We shall resolve their issues,” Museveni informed the delegates.

Museveni further said that he had already squeezed oil companies quite reasonably, and no mistake ever made before, by oil-producing countries globally at the start will happen again, here in Uganda.

“Coming late to oil production is also good because you find when other people have made mistakes and you benefit from them by not repeating the same mistakes,” Museveni said.

However, the Minister of energy and mineral development, Engineer Irene Muloni addressing delegates said that the summit will enable Uganda highlight opportunities surrounding the 2nd round of licensing declared earlier in May 2019, where Uganda announced bids for the new blocks for oil exploration in Bunyoro region.

READ  President Museveni ends Bush War trek with a call for pan Africanism

6.5 billion barrels of oil of which 1.4 billion – 1.7 billion barrels’ estimate is confirmed to be commercially viable.

And according to reports, actual production is expected to commence in 2023.

Ever since the collapse of the oil deal where Tullow Oil was meant to sell part of its interests in the Albertine Graben to Total E&P and China National Offshore Oil Company (CNOOC), this is president Museveni’s first public address regarding oil production in Uganda.

Uganda’s oil sector deal collapsed after the two-year time provided for negotiations met its expiry date.

The negotiations between the government and the companies regarding tax and how much money would be counted as recoverable costs failed at the time.

21 per cent of Tullow’s 33.3 per cent was meant to be transferred in Kingfisher Blocks to Total and CNOOC.

And if at all the companies sealed the deal, the Final Investment Decision (FID) would have been concluded at that time, and the oil pipeline and the refinery projects would have commenced.

Soon after the oil deal’s downfall, Total E&P suspended technical works on the pipeline and dropped a numbery of technical personals on the project, the same applied to CNOOC.

But politicians plus technocrats from the oil companies began advocating for the reopening of the oil talks right from the back yard, to enable the conclusion of the deal by the oil companies.