Uganda: Cabinet Okays Oil, Gas Policy

The long-awaited National Oil and Gas Policy which has been lying in Cabinet for over a year has finally been approved.

The draft policy which went to Cabinet about two years ago was delayed because of the need for further consultation with all stakeholders, in order to resolve all outstanding issues.

The policy provides for the administration, regulation and management of upstream petroleum, and presents a basis for regulating and investing in the midstream petroleum sub-sectors.

The policy also includes comments on issues regarding the management of the social and economic impact of oil and gas activities on the other sectors of the economy, together with management of revenue accruing from oil and gas.

Plans are currently underway to produce 4,000 barrels of oil daily from the reserves identified so far, which currently can flow at 26,000 barrels per day. This production will feed an early production scheme scheduled to start producing kerosene, diesel and fuel oil during 2009.

The fuel oil will be used to generate 50-100MW of electricity to alleviate power shortages in the country. There is an estimated 300 million barrels of oil in the Kaiso-Tonya area, where Waraga, Nzizi and Mputa discoveries were made. This area only covers less than 5% of the Albertine Graben, the area with the potential for petroleum production in the country.

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