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Uganda Authorises Total E & P Oil Production Licenses

Uganda’s Cabinet has authorised the Minister of Energy and Mineral Development, ailment Irene Muloni, to provide production licenses to French oil firm Total E & P, Chimp Corps report.

The delay in granting oil companies production licenses has since affected the oil sector with major multinationals laying off staff and businessmen losing money in investments.

Economists have as well cautioned that failure to commence early production amid plummeting oil prices would render the industry economically unviable.

Central Bank Governor Emmanuel Tumusiime-Mutebile also recently warned that once the uncertainty continues, foreign companies in the sector were likely to hold back their investments and that would have serious effects on the country’s anticipated oil production.

“One of our [BoU] forecasters, whom we depend on, had in March 2013 estimated that oil prices would be at $148 a barrel in 2019. But the same forecaster has currently revised his forecast down to $81 for the year 2019,” said the Governor.

Information Minister Frank Tumwebaze said Cabinet at the Wednesday sitting approved “consideration and approval of a request from the minister of energy to allow her issue three petroleum production licenses to Total E&P UGANDA B.V, over discoveries in Exploration Area 1 of the Albertine Graben, that is, Ngiri, Jobi-Rii and Gunya to be operated by total E&P Uganda B.V.”

Tumwebaze stated that the production licenses to be issued have a duration of 25 years and can be renewed for an additional five years as provided for in the Production sharing agreement (PSA).

“Also the licenses provide that where there are oil fields which extend across boundaries of license areas, it’s agreed that these oil fields will be developed as one unit,” added Tumwebaze.


Uganda has an estimated 6.5 billion barrels of petroleum resources from exploration work in less than 40 percent in the Albertine Graben.

However, less than 10 percent of the Albertine Graben is currently licensed and the six blocks targeted for this maiden licensing round have good data coverage.

Tumwebaze said the final investment decision is planned to be taken in 18 months after issuance of the production licenses and first oil is expected in the financial year 2019/2020.

“The Petroleum Authority of Uganda will regulate the licensed companies while the National oil company will participate in all licenses to take care of government’s commercial interests,” said Tumwebaze.

Uganda recently agreed to build the crude oil export pipeline to transport crude oil from Hoima to Tanga in Tanzania.

Total E & P, described the move as a “major milestone towards the development and production of Ugandan resources.”

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