Source: Elias Biryabarema, http://www.monitor.co.ug
Uganda could reap $5billion annually from oil exploration
Uganda could reap $5billion annually from oil exploration
For a nation as depressingly poor as Uganda,
this should pass for extraordinary tidings: the country will rake in an estimated $5 billion annually
from her petroleum exports once pumping crude starts
in the Southwestern region, according to projections by Tullow Oil.
That income forecast, Tullow's Uganda Country Manager,
Mr Brian Glover told Rotarians in Kampala on Friday, is based on an assumption of
a daily crude output of about 200,000 barrels per day.
Mr Glover cast this windfall as nothing less than miraculous for Uganda whose current
overall export earnings stand at a tiny $2 billion,
hardly able to generate enough revenue to cover basic state expenses on critical sectors
like education and health. "Right now tourism is the single biggest foreign exchange earner,
bringing in about $500 million and oil is going to (could) bring in ten times that," Mr Glover said.
Although hydrocarbon deposits in the Albertine Graben were first detected in 1938 by Shell,
the presence of commercial petroleum reserves were discovered in the area in February 2006
by Tullow Oil at Waraga-I well. Since then several more exploratory and appraisal wells have been drilled
by Tullow and Heritage Oil Corp, and Uganda now has a confirmed production capacity of
about 40,000 barrels oil per day.
While the $5 billion annual bounty may sound enormous and potentially life-changing,
the story of this windfall and its impact on Uganda pretty much appears set to instead morph into
the story of lottery winner, complete with the consequent ecstasy,
the spending binge and crass brokenness that follows.
Spooked by the possibility of this latter scenario, Mr Glover said that he had in fact accepted to come
to Uganda to prevent the kind of fate that befell Nigeria (where he was)
and its oil: the country exports about 2.5 million barrels per day and has earned
hundreds of billions of dollars in oil revenues over the decades but it is also home
to some of the worst forms of poverty and social-economic unrests on earth.
"I spent three years in Nigeria and what I saw there I would never want it to happen to Uganda,"
said Mr Glover.
Strangely though while Nigeria has long been cast as the quintessential postcard of
oil corruption in Africa,
Uganda has already turned to it for counsel on how best to extract and manage the resource.
On a visit to that country in November this year, President Yoweri Museveni who traveled
with a huge delegation of businesspeople was quoted as saying after talks with
the Nigerian leader, Mr Umaru Yar'Adua, "I would want Nigeria to impact its expertise in the field of oil exploration
to us so that our people can have the technical know-how rather than relying on people from outside the continent."
Mr Glover said once Uganda's petroleum extraction machinery starts to roll in earnest and at
full scale, the industry will be employing about 10,000 people.
Tullow Uganda chairman, Mr Elly Karuhanga said the government of Uganda in concert with
Tullow Oil and Heritage are working to establish a petroleum institute in Uganda,
expected to expand specialised expertise in the different fields of the
oil industry: exploration, contracting, production, marketing, revenue management and suchlike.
Proceeds from oil are ideally expected to be ploughed into
critical development sectors like education, health and infrastructure.
Source: Elias Biryabarema, http://www.monitor.co.ug
--
Jean-Louis Kayitenkore
Procurement Consultant
Gsm: (250) 08470205
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Kigali - RWANDA
East AFRICA
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