National Oil Company in Fresh Sale of Accumulated Crude Oil


In short
Over forty five thousand barrels of crude oil have accumulated since oil exploration begun on discovery of commercially viable oil in 2006

The Uganda National Oil Company (UNOC) is planning a fresh sale of accumulated crude oil resulting from oil explorations in the Albertine Graben.

This is the second time the government is trying to sell off over 45,000 barrels of crude oil stored in containers at facilities based in Nwoya and Buliisa district.

The Ministry of Energy initially said there were just 40,000 barrels of crude in stock and issued a bid notice in March 2015, inviting interested firms to bid for their purchase. The barrels of accumulated test crude oil were produced during testing of the operations in the Albertine Graben.

The 2015 bidding round according to the Energy Ministry did attract only three bidders on expiry of the bidding deadline. However, the bidding process could not proceed to the next stage because the bids submitted according to the Energy Ministry were non-responsive to the provisions in the solicitation documents.

The companies that submitted the bids are said not have understood the contents of the solicitation documents. Now the National Oil Company, the legally mandated entity for commercialization of crude oil has been handed the task to sell off the accumulated crude oil. 

The National Oil Company managed by Dr Josephine Wapakhabulo is expected to announce a fresh bidding process this week.

A statement from Uganda National Oil Company says the crude in stores has accumulated to over forty-five thousand (45, 211) barrels of sweet and waxy crude from Exploration Areas 1 and 2 in the Albertine Graben.

The Office of Auditor General in a 2016 Audit for the Energy Sector had questioned by the National Oil Company had not auctioned the crude oil.

The period between 2014 and 2015 witnessed low exploration interests following a drop in international crude oil prices explaining why the volume of crude oil on offer did not have a big change in terms of volume.

Test Crude oil can be used in fossil fuel-dependent operations like cement factories among others. 

A number of companies have also expressed indicated that they would use crude oil in power generation. Albatros Energy Uganda Limited and Lake Albert Infrastructure Services Limited submitted a request to the Electricity Regulatory Authority seeking to invest in power generation using crude oil and gas.

Hima Cement in 2015 also said it would use crude oil from the Albertine as part of its energy mix in cement production in Kasese. According to a plan by Uganda National Oil Company current round of crude oil sale is expected to take place between now and April this year.