Milton Olupot
4 July 2009
Kampala — OIL production in Uganda is expected to begin in five years time, the Permanent Secretary for energy and mineral development ministry, Kabagambe Kaliisa, has revealed.
Kabagambe told journalists at Parliament on Friday that the oil production plan was divided into the long and short term with the short term being gas production for generation of electricity which is expected to be operational at the end of next year.
"The long-term plan involves building a refinery for full-scale production of various oil products. This is expected to be accomplished in five years time.
The most important thing to note is that we have made bid discoveries that have put this country in a big advantage to start commercial production," he said.
Kabagambe earlier while appearing before the Parliament Public Accounts Committee said 11 oil fields had been discovered and he invited the committee to visit the oil exploration fields for an on-the-spot assessment of the progress.
He said the exploration efforts were continuing and that two billion barrels of oil had already been discovered. He clarified that only a certain percentage of this could be produced.
"If you are a poor producer you can get 10% but if you are a good producer, you can produce 60% of the two billion barrels," he said.
He also added that it is only 30% of the prospective oil fields that have been explored, suggesting that a lot more oil could be found in the other 70% prospective areas surveyed.
The Commissioner for Oil, Ernest Rubondo, told the committee that the oil reserves so far found are enough to support commercial development.
"The ministry is taking a feasibility study on the large-scale production. We are in consultation with oil companies to determine an appropriate early production scheme, which will involve production of gas for generating electricity," he said.
When asked about the agreements between the exploring companies and the Government of Uganda, Kabagambe said the documents were available and could be accessed by MPs if need be.
He said Cabinet was in the process of scrutinising the proposed law on the sharing of oil proceeds, adding that Uganda already has an oil and gas policy on which the oil exploration is based now.
A few years ago, oil and gas were discovered in the Albertine graben. The exploration areas stretch from West Nile to the southwestern tip of Uganda. Over 22 wells have been confirmed to contain oil.
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