Business
Uganda signs memorandum with oil firms
Publish Date: Feb 06, 2014
Uganda signs memorandum with oil firms
Journalists, NEMA and UWA officials at one of the oil wells known as Waraga I in Bunyoro. File Photo
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Uganda has signed a memorandum of understanding (MoU) regarding the start of oil production with Britain's Tullow Oil, Total of France and China's CNOOC, the government said.

East Africa's third-largest economy struck hydrocarbon deposits in 2006 but a tussle with oil firms over Uganda's demand for a refinery postponed commercial production, which is now expected to start in 2016 at the earliest.
 
"The government has signed an MoU on the sustainable development of the discovered petroleum resources in the Albertine Graben (basin) with the licensed oil companies operating in the country," the Energy Ministry said.
 
It said in a statement that the deal was signed late on Wednesday with the Ugandan units of Tullow, Total and CNOOC, which have formed a joint venture to develop the fields. A formal ceremony to mark the signing was held on Thursday.
 
The ministry said the MoU provided a framework for commercial production, including providing fuel for power generation, supplying crude oil to the refinery planned by the government and export of crude by pipeline.
 
Energy Minister Irene Muloni said last month that developing Uganda's oil fields and building infrastructure would cost between $15 billion and $22 billion, although there were plans to try to reduce that.
 
Uganda has agreed to build a pipeline to run to Kenya's planned new Indian Ocean port of Lamu, which is expected to become an export terminal for crude from Uganda, Kenya and other regional states.
 
Reuters

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