Kampala, Uganda | THE INDEPENDENT | The Petroleum Authority of Uganda (PAU) has approved US$483 million, equivalent to 1.7 trillion Shillings as recoverable costs by five oil companies.
The companies are Tullow, Total, China National Offshore Oil Company (CNOOC), Armour Energy and Oranto. According to Ernest Rubondo, the Chief Executive of PAU, the US$ 483 dollars in recoverable costs in 2018 is an increase from US$ 283 million in 2017.
On how realistic the recoverable costs are, Rubondo says the costs are assessed by the Auditor General before the petroleum authority approves them.
The actual recovery of the costs will be made when production of oil starts. According to the energy minister Irene Muloni, oil production is now expected to start in 2022 and not 2020 as earlier expected.
The extension is due to delayed final investment decision by the three joint venture partners – Total, Tullow and CNOOC – which has further delayed other oil development processes.
This oil matter will remain a mirage until they heed my advice. By the way what says the King of Bunyoro Kitaara? These people foolishly go about the oil drilling matter without consultation with the real owner and think mathematics and geology will deliver? Let us wait and see.
Who “represents” Uganda’s interests during national agreements? In the case of umeme the problem is with clause of Return on Investment (ROI). Where at zero rate of investment, “investors” are guaranteed by the Ugandan government 20%. Under the oil production sharing agreements (PSA), Uganda has already incurred a tune of more than a billion dollars without any drop of oil being produced. Amazing. To compound an already bad situation, production is to be delayed for at least another two years. Is this oil production a hoax? How much shall we be indebted at the time of the first production? Is the oil production a worthwhile venture for this country? Shouldn’t we, as country have this oil production discussion?
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Thanks for the kind words, Shane 🙂 And thanks for the suggestions. Feel free to suggest them “”officially”” using the included form. We’ll use those suggestions to update the post in coming months.