Dominion Petroleum Uganda, an independent U.K oil company, has announced that it has acquired a rig to begin drilling for oil in the Lake Edward basin.
The statement from Dominion says it has signed a letter of intent with Oil and Gas Exploration Cracow for the provision of the rig. It hopes that drilling will begin at the Ngaji-1 well in June.
Ngaji, the Kinyankole word for a silverback gorilla, is Dominion's first well in Uganda.
The site was chosen as the best location to test the geology of the Ugandan side of the Lake Edward Basin.
Dominion says site preparation will start before the end of March. An Environmental and Social Impact Assessment for a conditional seismic programme has been initiated for any subsequent appraisal work later in the year.
Dominion, which has 100% ownership of the block in which Ngaji-1 is located, says the prospect is located in an area comparable to another Ugandan discovery area reported to contain about 400 million barrels of recoverable oil.
In the press statement, Dominion Chief Executive Andrew Cochran says it has raised 32.7 million pounds for the process.
The drilling program by Dominion is part of Uganda's fast-expanding oil sector.
A mission from the African Department of the International Monetary Fund (IMF) that visited Uganda during early this month Uganda needs to boost its non-oil revenue and bolster its institutional and financial capacities to avoid the "oil curse".
Martine Guerguil, the IMF mission chief for Uganda, noted that oil will bring substantial revenue, but only for a limited number of years. She said channeling these resources in a careful and transparent manner is key to maintain macroeconomic stability and raise living standards in a durable way.