Nigerian, Australian firms get oil search licences in Uganda

Uganda has issued three more oil exploration licences to Nigerian and Australian firms as the country steps up efforts to become an oil producer in the next three years.

Oranto Petroleum International Ltd of Nigeria and Armour Energy Limited of Australia are among the first companies to complete negotiations of the production sharing agreements (PSAs) with the Ugandan government under the competitive licence round.

Oranto has been issued with two licences and will explore in Shallow and Deep Plays block in Ngassa, while Armour, with one licence, will search for the hydrocarbons in the Kanywataba block in Turacco. The oil blocks are located in the Lake Albert region in western Uganda where crude was discovered in 2006.

The Energy Minister Irene Muloni said a formal announcement will be made on Friday.

With issuance of the new licences, the number of permits is now at 12. British Tullow Oil has five, French Total three while Chinese CNOOC has one.

The country, with an estimated potential of 6.5 billion barrels of reserves of which between 1.4 and 1.7 billion barrels are recoverable, targets to start oil production by 2020.

Construction of the $3.55 billion pipeline that will evacuate the crude from Kabaale in the western Hoima district to Chongoleani peninsula, near the Tanga port in Tanzania is already underway. The pipeline is expected to be completed by 2020.


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