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Alleged Scheme to Privatize Uganda National Oil Company Sparks Concerns in Parliament

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A controversy has erupted in Uganda as reports suggest that certain individuals are involved in a dubious plot to register the Uganda National Oil Company (UNOC) as a personal entity in Kenya, with aspirations of monopolizing the importation of petroleum products into Uganda.

Emmanuel Otaala, the Member of Parliament for West Budama South, brought this disconcerting information to the attention of the Parliament’s Natural Resources Committee. Otaala raised eyebrows, stating, “The emerging information indicates that the UNOC being registered in Kenya is owned by individuals. Is this something of concern to you?”

In a recent announcement, Minister of Energy Ruth Nankabirwa disclosed that starting January 2024, all oil marketing companies in Uganda will be mandated to exclusively procure their fuel and gas products from UNOC. This strategic decision aims to stabilize the country’s fuel supply and reduce reliance on imports from Kenya.

However, concerns have surfaced among Members of Parliament regarding the timeline for Uganda’s inaugural oil production. Although the Minister had initially set a target of May 2025, a recent statement mentioned the end of 2025, prompting MPs to seek clarification on a potential shift in the roadmap.

Minister Nankabirwa attributed the timeline adjustment to the influence of Civil Society groups campaigning against Uganda’s oil projects. She assured Parliament of the government’s unwavering commitment to restoring stability in the sector and ensuring the timely delivery of the oil project.

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In addressing the criticism from Western nations discouraging Uganda’s oil production for environmental reasons, the Minister pointed out their reliance on coal amid a gas crisis. She emphasized that Uganda should not be lectured by countries with such inconsistencies.

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Uganda’s strides in its oil drilling program are evident with the initiation of the Kingfisher field project in Lake Albert, valued at $10 billion. Operated by the China National Offshore Oil Corporation (CNOOC), the project aims to develop Uganda’s oil reserves and includes constructing a pipeline for crude transportation to international markets through a Tanzanian port.

The Kingfisher field is anticipated to reach a peak production rate of 40,000 barrels of oil per day. Another project, Tilenga, operated by TotalEnergies, is situated north of Lake Albert along the River Nile.

CNOOC, TotalEnergies, and the Uganda National Oil Company collectively own all existing oilfields in Uganda. The country aims to produce approximately 230,000 barrels of crude oil per day at its peak production level, with estimated reserves of 6.5 billion barrels, 1.4 billion of which are deemed recoverable.

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Despite these ambitious plans, opposition from human rights activists and environmental groups has arisen against the oil extraction initiatives in Lake Albert. Concerns focus on potential threats to the delicate ecosystem of the region and the livelihoods of local communities.

It is essential to note that the information provided is based on sources available until September 2021, and for the latest updates, it is recommended to follow reputable news sources or refer to official statements from relevant authorities.

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