Uganda has announced that it will auction new oil exploration acreage by December this year
Land owners at the site of a planned crude oil refinery will also be compensated, a government official said.
Investor interest in Uganda’s hydrocarbons potential has been growing since the East African country discovered commercial crude reserves in 2006, now estimated by government geologists at 6.5bn barrels, according to Reuters.
In September this year, the Energy Ministry had issued a tender for a consultant to help prepare and package seismic and other data for the exploration fields that will be up for auction.
“The consultant will also tell us how many blocks, which ones and their values,” said Ernest Rubondo, commissioner for petroleum exploration and production department.
Rubondo added that the government had compensated about 70 of the landowners at a site in western Uganda where the US$2.5bn refinery is planned to be developed. The remaining would be compensated by the end of this year, the commissioner added.
Two consortia led by Russia’s RT-Global Resources and South Korea’s SK Group are competing as final bidders to develop the refinery project and the winner is expected to be announced by the end of 2014.
UK-listed Tullow Oil, French oil explorer Total and China National Offshore Oil Corporation (CNOOC) are exploring for oil in Uganda. Tullow has estimated Uganda could earn up to US$50bn from its oil reserves.
Uganda said that only about 20 per cent of its Albertine Graben — the oil-rich basin straddling the border with DR Congo — has been explored, recording a drilling success rate of more than 85 per cent.