Uganda

Uganda: All Eyes on Sustainability

Uganda holds an estimated 1.4 billion barrels of recoverable oil. Oil was first discovered in the country in 2006 in the Albertine Rift Basin. Since then, the government has been putting comprehensive measures in place to ensure the efficient and value-added development of the country’s oil and gas resources.

This includes enacting the National Oil and Gas Policy in 2008, the formulation of the petroleum upstream and midstream laws in 2013 and attendant regulations in 2016, and the 2016 creation of the Petroleum Authority of Uganda to regulate the different players in the industry and the Uganda National Oil Company (UNOC) to handle commercial interests of the state and state participation. The Ministry of Energy and Mineral Development has overall responsibility for developing and managing the nation’s energy resources.

The country’s significant renewable energy sources include hydropower, biomass, solar, geothermal, wind and peat. UNREEEA cites the country’s overall renewable energy potential as 5.3 GW.

Today, Uganda’s hydrocarbons activity is focused on two projects: the Tilenga Project and the Kingfisher Project. Commercialisation is expected via an in-country refinery with a capacity of 60,000 bpd and via the East African Crude Oil Pipeline (EACOP), with a capacity of 216,000 bpd. Both are being developed to receive first oil by 2023-2024. In order to increase the country’s resource base for sustainable and viable petroleum production, the government has also commenced exploration of frontier basins, starting with the Moroto-Kadam Basin.

In April 2021, TotalEnergies signed a tripartite agreement with the governments of Uganda and Tanzania to proceed with developing the Lake Albert resources and the EACOP. In February 2022, the government of Uganda reached an FID with TotalEnergies and CNOOC for the projects valued at at least USD 10 billion.

The government has, to date, awarded nine production licences. France’s Total has emerged as the dominant IOC in the country, today holding a 56.67% stake in the Lake Albert project and operating the Tilenga Project. China’s CNOOC holds 28.33% in the Lake Albert project and operates the Kingfisher Project. UNOC holds 15% in the projects. In September 2020, the country’s Second Licensing Round closed, with five blocks on offer in the Albertine Graben. Qualifying companies’ proposals were due June 30, 2021.