Uganda to begin oil production this year, says Tullow
By Francis Mugerwa
Posted Saturday, June 4 2011 at 00:00
Uganda is set to start commercial oil production this year, Tullow oil, the company contracted to explore oil in the Albertine grabben, has said.
“We have planned to start extracting small amounts of crude oil which we shall supply to industries for power generation,” Tullow oil’s country manager Brian Glover said while addressing Bunyoro Kitara kingdom officials at the Omukama’s Karuziika Palace in Hoima town early this week.
Mr Glover, who made a presentation to cultural leaders in presence of the Omukama (king), estimated the amount of oil to be produced to be “initially in hundreds of barrels per day” but added that the amounts are bound to increase as production scales up gradually.
Tullow Oil plans to conduct an extended well-testing exercise to determine the flow rate of the various oil fields. The tested crude will be used to generate thermal power in the industries that will purchase it.
Mr Glover revealed that Hima Cement factory in Kasese District has expressed interest in utilising the crude oil. The budding oil industry is also expected to increase power generation which will reduce the rampant load shedding which is affecting production, especially in industries.
He revealed that plans are also in advanced stages to start a gas power project at Kabaale station in Buseruka Sub-county. “The 50 megawatt power plant will commence next year,” he added.
The government has proposed the construction of a refinery in Buseruka Sub-county, according to feasibility studies which have been conducted by the Energy ministry.
Glover said the refinery project is expected to be finalised in three to five years. The company has described the area in Bunyoro where oil has been discovered as a “world class basin”.
The United Kingdom-based firm which has reportedly invested over $800 million in oil and gas exploration since 2001 has enjoyed back- to- back oil discoveries with 37 out of 38 well drilled rich oil reserves.
Although the oil explorers have so far reportedly discovered about a billion barrels of oil, experts foresee the Albertine basin having a potential of up to 2.5 billion barrel of oil.
“Together with our new partners, Total and CNOOC, Tullow is working with government to transform this discovery into a world class development,” Glover said.