11 December 2012

Uganda: Tullow Oil Denies Exit Talk

Photo: Rogers Okwany/NewVision
Members of Parliament failed to vote on the oil bill after a chaotic plenary.

Kampala — Irish firm, Tullow Oil has denied that it is planning to pull out the Uganda oil market because of the delays in resolving outstanding issues in the sector.

Media reports had stated that the company was reportedly frustrated at the lack of progress on arriving at "a final investment decision" about whether to build a pipeline or a refinery.

The East African Newspaper quotes Tullow oil publicist Cathy Adengo as saying, "Our programme for appraisals is complete and the development means we either pump crude oil or refine it, so there is currently not much work in the field."

The newspaper added that several well-placed sources in the industry say the lack of movement on the issue is causing the company to internally consider its exit options.

Mr. Elly Karuhunga, the President of Tullow Oil Uganda while speaking last week at the Public Dialogue on Oil and Gas in Kampala affirmed that Tullow is here for a long time despite the delays in approving many proposals.

"These (oil) companies are here for a long haul because they have invested huge risk capital. That is why they never answer back to accusations," he said.

David Bishop, the Technical Training manager at Tullow Oil Plc told East African Business Week that the company is not planning to exit and that it was here for the 'long run'.

"We had a meeting with the board and it was confirmed to the staff that the reports are not true and we are going to be here in the production process for the next 25-30 years," said Bishop.

"Because we have to adhere to international standards, we are in talks with Nakawa Vocational Training Institute to establish a trainers' training center in partnership with a European awarding institution."

He was speaking to East African Business Week on the sidelines of a Uganda Manufacturers' Association (UMA) organized business luncheon in Kampala recently.

Mr. Ivan Kyayonka, the General Manager of Shell Uganda while addressing the manufacturer's lauded Tullow Oil's move to set up a training center in the country.

He said, "I was worried about the graduates we were churning out because we are training geologists and yet most of that work is complete. We hadn't thought of training welders to work on the pipeline because that is where we are going."

Kyayonka also added, "I hope we shall be in time so that when we are ready you don't say that you have already awarded the tender."

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