Uganda issues 8 production licences to Tullow Oil, Total
Tuesday August 30 2016
Uganda's Energy Minister Irene Muloni (right) hands over documents to Tullow Uganda's Jimmy Mugerwa (left), Total E&P's Adewale Fayemi (second left) and CNOOC'S Xiao Zongwei during the awarding of oil production licences in Kampala on August 30, 2016. PHOTO | MORGAN MBABAZI
Uganda has issued eight oil production licenses to two firms, British Tullow Oil and France’s Total as it moves to speed up its export plans.
On Tuesday, Tullow was allotted five licences while Total got three, bringing the total permits issued to nine after the Uganda handed one to the Chinese National Offshore Oil Company (CNOOC) in 2013.
The country has set a target of 2020 for its oil to begin flowing from the 6.5 billion barrels of reserves confirmed so far out of which between 1.4 and 1.7 billion barrels are recoverable.
Exploration efforts for more hydrocarbons have also been enhanced with the signing of production sharing agreements (PSAs) with three Nigerian and one Australian earlier this month.
Uganda’s oil fields, for which the production licences were issued, are jointly owned by Total, Tullow and CNOOK following a $2.9 billion farm down by Tullow to the two others in February 2012.
“The companies are expected to move towards Final Investment Decision within 18 months after the issuance of the production licenses and field oil is expected in the year 2020,” said energy minister, Irene Muloni while handing over the licenses in Kampala.
The companies are expected to invest $8 billion in the oil-related infrastructure. The investments will include drilling of about 500 wells, construction of central processing facilities and feeder pipeline among others.
Some of the petroleum will be refined locally by a 60,000 barrel-refinery to be built in Kabale, Hoima district while the rest will be evacuated by a crude pipeline through Tanzania to Tanga Port.