Uganda plans to develop the Kingfisher and Tilega oilfields
at a cost of US $5bn in a bid to expedite the growth of its oil industry. The
two oilfields are currently the subject of a tax dispute between government and
three oil companies.
According to Permanent Secretary of Energy, Robert Kasande,
this amount forms part of the US $15bn to US $20bn projected to flow into the
country’s developing oil industry in three to five years, including the
construction of a refinery and crude pipeline. “The funding will be used to
drill over 500 wells and construct two central processing facilities and a
water plant. Plans are also in the pipeline to award exploration companies five
blocks by the end of this year,” he affirmed.
The five blocks
The five blocks on offer are located in the Albertine Basin;
namely: Block 01 (Avivi), Block 02 (Omuka), Block 03 (Kasuruban), Block 04
(Turaco) and Block 05 (Ngaji). The bidding process will run for five months.
The licensing round is scheduled to conclude by December 2020, with successful
firms set to receive Petroleum Exploration Licenses.
Total, CNOOC and Tullow Oil jointly own the Kingfisher and
Tilega fields and the Ugandan government is in negotiations with Tullow to
reduce its stake in the projects and allow final investment decisions to be
The company indicated in its trading update that, joint
venture conversations with the government of Uganda are ongoing and Tullow
remains committed to reducing its equity stake in the project ahead of a final