Uganda pushes back award of exploration licences
Sunday June 07 2020
Uganda is waiting for more applications for oil exploration. PHOTO | FILE | NATION MEDIA GROUP
Uganda has pushed back the licensing round for five new oil blocks in the Albertine Graben to September 30, 2020, following low interest from exploration companies.
Six companies had submitted expressions of interest proposals, but there were no detailed bids for the advertised oil blocks by the end of March 2020 as expected.
The postponement will likely affect the scheduled opening of bids and award of licences according to both private and government officials.
“The six were yet to submit their detailed proposals. Once we get all the bids in by September 30, we hope to award the licences by end of this year but more likely in January next year,” said Robert Kasande, the permanent secretary at Uganda’s Ministry of Energy and Mineral Development.
Mr Kasande told The EastAfrican that six local and international companies had expressed interest to vie for five oil blocks on offer, but could not give details citing confidentiality rules.
He said the postponement was as a result of the Covid-19 pandemic that has shrunk economic activity, curtailed air travel and partly led to the global collapse of the crude oil prices, a situation that is likely to linger until the global economy rebounds.
Last year, Uganda launched its second licensing round for five blocks in the oil rich Albertine Graben during the East African Petroleum Conference and Exhibition in Mombasa in May.
Initially, Kampala pegged its hopes on the high crude oil price that at the time was about $70 per barrel, and as such set a September 30, 2019 deadline for bids. However, with no interest registered by then, the deadline was extended to end of March this year.
Mr Kasande said that the government was waiting for more international companies to make their applications before issuing invitation of detailed bids.
The second licensing round comprises of five blocks, which include Block 01 (Avivi) covering 1,026 square kilometres; Block 02 (Omuka) covering 750 square kilometres, Block 03 (Kasuruban) which covers 1,285 square kilometres, Block 04 (Turaco) that covers 637 square kilometres and Block 05 (Ngaji) covering 1,230 square kilometres.