9 Oil Production License Applications Await Approval – Govt

1528 Views Kampala, Uganda

In short
Of the ten applications, only one production license has been issued, in September 2013, and that is for the Kingfisher Discovery currently being operated by CNOOC. Uganda is estimated to have discoveries estimated at 3.5 billion barrels with potential extraction being 1.2 billion barrels.

The Petroleum Exploration and Production Department (PEPD) has today confirmed that oil companies Total, CNOOC and Tullow have applied for at least 10 oil production licenses.  
 
This is at least 48percent of the 21 discoveries made in the Albertine Graben since 2006.
 
Of the ten applications, only one production license has been issued, in September 2013, and that is for the Kingfisher Discovery currently being operated by CNOOC.  A production license is the final phase in the oil production cycle - exploration, appraisal, development and production - , eventually leading to commercial oil production. Uganda is estimated to have discoveries estimated at 3.5 billion barrels with potential extraction being 1.2 billion barrels.
 
Of the nine applications, Tullow Uganda Operations has submitted eight, whereas Total E&P Uganda made one application. In a press statement issued by PEPD today, government reveals to have “reviewed these submissions and is in discussions with Tullow with regard to content of the submissions.” Total made its submission in December 2013 and currently their application is being reviewed.
 
Ernest Rubondo, the Commissioner for Petroleum Exploration and Production Department, says the licensed oil companies in the country have submitted the applications together with the respective Field Development Plans (FDP) and Petroleum Reservoir Reports (PRR) in-line with the provisions of the Petroleum (Exploration, Development and Production) Act 2013.
 
The statement further reads that Rubondo said after the submissions, government engages the oil companies in what he termed as “technical discussions” at least until “consensus is achieved,” which then leads to the granting of a production license, or not.
 
First oil production in Uganda is projected for 2017 once an oil refinery is complete. Once a production license is issued, a company has up to 5years to setup the required infrastructure and also investment capital begins to flow. For instance with CNOOC's production license, at least 2 billion US Dollars is to be invested over the next five years.