Business
Uganda: Oil production hits setback
Oil prospecting in Uganda. PHOTO/File
The recent signing of new oil agreements between Uganda and Tullow has paved the way for the farm-down to partners Total and Chinese company CNOOC, but unresolved issues of infrastructure, oil laws, environment and delays in approval of work permits for the oil firms’ expatriates are fuelling uncertainty, and could potentially drive investors away from Uganda.
In the event that Kenya or Tanzania made significant oil discoveries in the short term, the two countries would be more attractive, considering that they are on the sea and have ports.
“A threat is developing that a significant oil find in either Tanzania or Kenya could result in loss of interest in Uganda. Tanzania and Kenya are currently witnessing a surge in exploration activity. The absence of a definitive infrastructural plan for processing or exporting Ugandan oil exacerbates the threat,” reads a confidential documents from the industry