Who is misguiding Ugandans and the World about Uganda's oil?

By Aisha Kabanda

THE New Vision of 21 Feb 21, broke the unbelievable but true news of a Uganda MP petitioning the British House of Commons to blacklist Tullow Oil a British firm, for arbitrarily signing contracts with Government against the wishes of Uganda’s Parliament.  

This came after a special session of Parliament before which H.E. the President of Uganda explained the genesis of oil discovery, exploration and exploitation in Uganda. One wonders if the said MP had the best interest of Uganda at heart. 

I listened to the President’s address seeking to understand why he apparently disregarded Parliament’s advice oil.  He explained how he delayed oil exploitation for lack of indigenous experts.  

He decided to sponsor Ugandans to study petroleum science, petroleum law and petroleum economics.  He refused to be rushed by quick gains and was not derailed by lies that all the oil 'had evaporated'.   

Evidently, this is not a sign of selfish and insensitive leader, who does not have the best interest of the country at heart.  He vested all Uganda’s hope and confidence in them, as experts.  

He said the first agreements were drawn by these technical sons and daughters of this land without a lot of his intervention.  This tells that once he has confidence in people, he gives them the opportunity to carry out their assignments utilising their expertise without undue influence.  

The puzzle of cost recovery and revenue sharing

The President stated that the next huddle was lack of funds to begin exploration, which was overcome by seeking out companies willing to invest in the sector. The agreements provide for companies to retain 60% of the production until their costs were recovered, with the government retaining 40% on top of taxes, loyalties and a share stake in the company.

The fact that a technical committee exists to examine every aspect of the oil companies’ programme and the Auditor General too plays his verification role, considering the revised sharing ratio after recovery of costs; Uganda is in the best position to secure the country's interests.  

The President emphasised the possible loss of value due to energy global trends and scientific quest for old substitutes.  The person who seeks to sabotage the process cannot only be seen as economic saboteur but also committed a treasonable act against the state.  

Uganda has substantial technical expertise and capacity to deliver, an example in point being the successful litigation and recovery of taxes from Heritage Oil which had transferred its interest.  

With agreements in place to establish technologies that convert gas into electricity, steel processing and uranium to boost agricultural production, put Uganda ahead of Nigeria which has been in oil production for the last 55 years.  There could be a few gaps but attempting to stall the project is unacceptable.    

According to the National Planning Authority Bill, Uganda’s transformation to a middle class economy requires $18b.  The oil deal, in the current state promises to take in $5b annually; this implies that in three years, we shall be able to realise money sufficient for the economical transformation envisaged by the grand plan.  

Bunyoro’s demands

 I find it unpatriotic, sectarian and selfish when I hear the Banyoro being hoodwinked by self seekers to demand for a sharing formula that takes into account their regional interest.  Currently 90% of the country’s GDP is generated from central region.  

This would provoke the central region to ask for a sharing criteria basing on their contribution to the national development for all the past.  We have been reliably assured by the President that revenues from oil shall strictly be utilised for development in particular energy and infrastructure. My imagination supposes that it would be prudent to wait until when the revenues have improved to demand for regional sharing.

Some people are staking the security of this country for this oil; a resource that has been unexploited for ages, first documented by E J Wayland in 1920s.  All this time to 1986 Uganda was unstable; engaged in conflict after conflict which did not enable the leadership of the time to concretise the finding and progress.  

The prevailing peace and stability has enabled us to reach this far and should not be staked for any reason.  Let us not be tempted to destroy the bud before it blossoms into a real flower.

Writer is the Vice Chairperson, NRM Women’s League, Central Region