KAMPALA, UGANDA - Uganda’s oil reserves could be as much as that of the Gulf countries, a senior official at the US Department of Energy has said.

Based on the test flow results encountered at the wells so far drilled and other oil numbers, Ms. Sally Kornfeld, a senior analyst in the office of fossil energy went ahead to talk about Uganda’s oil reservoirs in the same sentence as Saudi Arabia.”You are blessed with amazing reservoirs. Your reservoirs are incredible. I am amazed by what I have seen, you might rival Saudi Arabia,” Kornfeld told a visiting delegation from Uganda in Washington DC.

The group of Ugandans was in Washington on an international visitor programme and looked at the efficient use of natural energy resources.

The group comprised Ministry of Energy officials, a Member of Parliament, members from the civil society and one journalist.

At present, Uganda has four oil prospectors on the ground including Heritage Oil, Tullow Oil, Tower Oil and Dominion Oil.

Of the four prospectors, Tullow and Heritage have registered success at wells in two blocks in the Albertine basin, which lies in the upper-most part of the western arm of the Great Rift Valley.

According to data so far aggregated since the first discovery was made by Australian prospector Hardman Resources (now taken over by Tullow) in June 2006, Uganda has established reserves at 3.5 million barrels of oil per day.

Experts in oil exploration say this could be just a tip of the iceberg.

…

In April last year, Tullow embarked on what it termed as a major drilling campaign in the Butiaba area around Lake Albert targeting an overall reserve potential in excess of a billion barrels.

The Butiaba campaign was preceded by successes in two drilling campaigns in the Kaiso-Tonya area and the Kingfisher field and all these have been 100% successes so far.

The Butiaba campaign has thrown up successes but the two biggest so far have been the Buffalo-Giraffe wells – described as “one of the largest recent onshore oil discoveries in Africa“.

“Combined with our other finds in the region, we have now clearly exceeded the thresholds for basin development,” the chief executive of Tullow commented then.

The Giraffe-1 exploration well, which is located in the Butiaba region, came up with over 38 metres of net oil pay within an 89-metre gross oil bearing interval.

The data from the Giraffe discovery indicate a net reservoir thickness of 38 metres, the largest encountered in the area to date.

The Buffalo-1 exploration well in Block 1 encountered 15 metres of net gas pay and over 28 metres of net oil pay.

The gas and oil columns encountered are 48 metres and 75 metres respectively with the potential to be even larger.

As Kornfeld marveled at Uganda’s oil finds, she was quick to add that for the country to benefit from the oil and gas resources but also avoid the pitfalls of oil producing countries like Nigeria, it is extremely important to set up strong governance structures.

Kornfeld and the other United States officials said they are ready to help Uganda’s nascent oil and gas sector with anything including the key environmental issues that are crucial to the efficient management of oil and gas.

“Anything you might want us to help you with we will and we have a lot of expertise in environmental issues relating to oil and gas,” Kornfeld said.

And in a quote from the article written a year ago, with the oil blocks pictured above:

“The Albert Basin now looks increasingly like it has the elements to make it a world-class petroleum basin. The flow rates, even constrained by available completion and test facilities, far exceeded our expectations,” Tony Buckingham says.

It is certainly true the the US has a lot of experience, and one might say expertise, in environmental issues relating to oil and gas. Unfortunately much of that expertise and experience is involved in circumventing and evading environmental law and responsible environmental management.

Then, as Ms. Kornfeld said, there is the issue of avoiding the pitfalls of other oil producing countries like Nigeria. In general, the US has supported the policies and governments in Nigeria that have engineered these pitfalls, into seemingly bottomless pits, working along with the US based oil corporations operating in Nigeria. So although they might know what to avoid in order to be socially and environmentally responsible, there is no indication that the US government or the oil corporations have any intention of acting in socially or environmentally responsible ways. Uganda does not have much history of environmentalism it can point to with pride either. So far the US response to African oil issues has been almost entirely military, hence AFRICOM, the US Africa Command.

The Uganda government may be strong in the sense of using muscle to insure compliance. It employs muscle internally against dissent, and externally to assist in exploiting the resources of its neighbors, particularly in the DRC. However its democratic history is weak, and employment of any form of participatory democracy in decision making is sadly lacking. The US has been an enthusiastic supporter of Uganda’s “strength”. Mahmood Mamdani points out that Museveni has been a US proxy in Rwanda, and is still a US proxy in the DRC. AMISOM soldiers from Uganda are in Somalia acting as US proxies, and the underlying issue there too is oil.

Museveni‘s name means son of a man of the seventh, meaning from the Seventh Battalion of the Kings Africa Rifles. That seems ironically appropriate, as Uganda is acting as a US proxy in the DRC, Somalia, and Ugandan mercenaries have played a prominent role in Iraq. US proxy warriors in Africa have been referred to as Bush’s Africa Rifles, now Obama’s Africa Rifles, not too different from the colonial proxy war tradition of the King’s Africa Rifles.

Museveni has shown no interest in allowing any democratic opposition to his presidency. In May he declared: I see no successor in NRM.

He may have ruled Uganda for the past twenty three years but President Yoweri Museveni is still hesitant to hand over power, not even to members of the National Resistance Movement, of which he is the leader.

On Thursday the president told NRM Members of Parliament that while he would be “happy” to hand over power, he saw “nobody” ready to take on the daunting responsibility of leading Uganda.

So the Uganda government will continue to run along lines that Museveni sees as in his/Uganda’s interest. I don’t know if this is the “strong governance structures” to which Kornfeld refers. It may well be. She and her cronies may see this as the most convenient way for the US to access Ugandan oil. But it cannot be described as democratic, or in any way resembling participatory democracy. Unless people who live where the resources are can benefit from those resources, and have some say in how they are disposed, there will be conflict. And problems are already brewing. In April 2009 Uganda Bunyoro Kingdom Threatens Lawsuit over Oil Exploration:

Cultural leaders of Uganda’s Bunyoro kingdom, located on the Ugandan side of the oil-rich Albertine rift, have threatened legal action against the central government over oil exploration and production activities there, a kingdom official said Monday, but the government has promised talks to resolve the issue.

Yolamu Nsamba, the principal private secretary of the king of Bunyoro, said the government has breached the pre-independence agreement of 1955, which provides that Bunyoro is entitled to substantial amounts of revenue from mineral exploration in its kingdom.

“For years now, the central government has been dealing with oil exploration companies secretly yet the law has never been changed,” he said, adding that kingdom officials have already informed the central government of its intentions.

A government official told Dow Jones Newswires separately Monday that the central government would soon start talks with kingdom officials to resolve the issue. Uganda is expected to embark on an early oil production scheme in the first quarter of 2010.

The 1955 agreement was signed between the Bunyoro Kitara Kingdom and the U.K. protectorate government and stipulates that in the event of mineral development taking place in Bunyoro, a substantial part of the mineral royalties and revenue from mining leases would be paid to the native government of Bunyoro Kitara.

Bunyoro remains influential in Uganda although its cultural leaders are prohibited from engaging in national politics.

It will be interesting to see how Bunyoro fares in maintaining some control over its riches. And there are troubles with the neighbors too. In May 2009 Uganda beefs up marine surveillance on its waters.

Uganda has stepped up security on its waterways and is quietly revamping its marine police in anticipation of tensions with its neighbours over the country’s natural resources.
…
Apparently, the discovery of high-value natural resources such as oil and gas under and near Uganda’s lakes and the need to protect fisheries resources are the imperative behind moves to improve security on the country’s waters.
…
The Police Marine Unit has acquired four specialised boats at a cost of $8.6 million to be paid over a period of five years.

The acquisitions and keen interest in marine security come in the wake of an incident in August 2007, when Congolese troops on the disputed Rukwanzi island in Lake Albert shot and killed oil prospectors who were carrying out surveys on the Ugandan side of the lake.

Officials say terror threats have also underscored the need for improving security on the country’s lakes because Uganda’s main Entebbe airport — the kind of key infrastructure usually targeted by terrorists — is located on a peninsula in Lake Victoria.
…
Much as the boats are up and running and have recently been seen around Migingo island, over which Kenya and Uganda are squabbling, questions are being raised over the capacity of the police to take on and maintain such infrastructure both financially and technically.

Uganda is landlocked, so issues of how and where the oil will be refined and transported are still up in the air. Tullow, Heritage Face Tough Choices on Uganda Oil Devt.

After remarkable exploration success in Uganda, Tullow Oil PLC (TLW.LN) and Heritage Oil Ltd. (HOIL.LN) face tough choices over how to develop the oil they’ve discovered.

Both companies face immense infrastructure challenges bringing the oil from its remote region to world markets. They have to walk a fine line between their commercial goals and the sometimes conflicting ambitions of the Ugandan government. Tullow and Heritage also have to handle overtures from much larger rivals that want in on the substantial quantities of oil they have discovered.
…
“Lake Albert is a multibillion-barrel basin,” with great potential to expand reserves even further once problems with licenses on the Congolese side of the lake are resolved and exploration begins there, said Paul Atherton, chief financial officer of Heritage.
…

Tullow and Heritage have long talked of exporting the Lake Albert oil to world markets via Kenya, initially by rail to the port of Mombassa and eventually through a large enough pipeline to carry the 150,000 barrels of oil per day the basin is thought to be capable of producing.

The government has clashed recently with Tullow over the pipeline, said an official at the energy and minerals ministry.

And Uganda’s energy minister recently said no unrefined oil should be exported from Uganda and instead the country should build a refinery to process all domestic crude and supply oil products to the whole region.
…

As talks on the development move slowly forward, one voice that has been heard little so far is that of the local communities, said Dickens Kamugisha, chief executive of the African Institute for Energy Governance, a non-governmental organization based in the Ugandan capital.

Local people are worried about the problems caused in Nigeria, Angola and Chad by the exploitation of oil resources and unchecked flows of petrodollars to governments with a reputation for corruption, he said. “The process has been secretive,” with insufficient public discussion over the competing development plans and no publication of the production-sharing contracts between the Ugandan government and the companies, he said.

Tullow and Heritage stressed that they have maintained good relationships with local communities. Tullow said it has shown local people around their drill sites to explain what they are doing and both companies are contributing to local development by funding schools, health clinics and even lifeboat training on the lake. Employment of local people “would be an integral part of any development plan,” along the lines of work the company has done in Ghana, said McDade.

Kamugisha acknowledged the local work of the companies, but expressed concern about the lack of transparency from the government. He said he wants the Ugandan government to follow the principles of the Extractive Industries Transparency Initiative and declare all oil revenues openly in order to prevent corruption. Both Tullow and Heritage said they are happy to disclose the terms of their contracts — which they described as containing good terms for Uganda — if the government allows it.

Whether this is enough is unclear. A dispute is already brewing over who controls rights to minerals in the Lake Albert area and how revenues will be distributed between the government and leaders of the Bunyoro Kingdom — the ethnic grouping that occupies districts on the lake’s eastern shore . Local communities “say they have been completely left out of the process and are not satisfied,” said Kamugisha.

Interesting. I wonder if all nations in Africa would be an oil-producing nation?

By the way, Nigeria is the laughing stock of the world. I mean, we are like the Michael Jackson and Mc Hammer of the world, when it comes to managing our resources. We are just useless at it.

Yeah I mentioned it. Bite me.

Hmm, Interesting. truely , truel interesting. The continent is blessed, truely. But how are we turning out with these sit tight visionless leaders straddling the length and breath of the continent?

Oh dear.

Local communities “say they have been completely left out of the process and are not satisfied,” said Kamugisha.

It appears Uganda may actually be failing at learning from Nigeria!

so oil is now Nigeria's pitfall? Or the stupid people that is called her citizens?

tosh_acer:

so oil is now Nigeria's pitfall? Or the stupid people that is called her citizens?

That statement and your view are more or less the same.

--------------------------------------------------------------------------------
so oil is now Nigeria's pitfall? Or the stupid people that is called her citizens?

Would the Niger delta militant's be fighting if 1) they have no oil 2) listened to what El-Rufai advice FG that what the whole Niger delta needs a comprehensive development plan mirroed just like the Abuja plan. But our Mr president chose to establish a ministry of Niger delta.

It is simple all these other African countries will go the same as Nigeria if they ignore the localilty where the oil is refined.

can you provide a link to the original source Knowall?

Uganda is already fkced up

can you provide a link to the original source Knowall?


I could not link it to my post hence why I cut and paste the content. If I find the link I will definately post it, I actually stumbled on this post whilst  looking for something else.

Fresh Uganda oil find ‘Africa’s biggest’Robin Pagnamenta

Heritage Oil announced details of a large oil discovery in Uganda yesterday, which the company claimed could be the largest onshore discovery in sub-Saharan Africa.

Heritage said that its latest discovery – Giraffe1 – in the Lake Albert region, could total at least 400 million barrels of oil.

However, Paul Atherton, chief financial officer, told The Times that the wider field it was developing, dubbed Buffalo-Giraffe, had several “billions of barrels of oil in place”, although it was unclear how much of this would be recoverable.

He said that the field, which is 9,000 square kilometers in size – or six times the size of Greater London – was unquestionably the largest onshore discovery made in sub-Saharan Africa in at least 20 years, possibly ever.

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Mr Atherton said that of the 18 wells the company had drilled in the basin so far, all had produced oil. “Clearly the entire basin is full of oil,” he said. “It’s a world-class discovery, the most exciting new basin in Africa in decades.”

Previously, the largest onshore fields discovered in sub-Saharan Africa were at Rabi-Kounga in Gabon, where 900 million barrels were found in 1985, and at Kome in Chad, where 485 million barrels were found in 1977.

Mr Atherton said that it would take at least another three years to start commercial production. The crude could be exported by road or rail, he said, but analysts believe that the most practical solution would be to build an 806-mile pipeline to take it to Kampala, Uganda’s capital, and then the Kenyan coast. The pipeline would need to be heated and designed to traverse swampy and mountainous land. It would cost an estimated $1.5 billion (£1 billion) to complete.

Heritage and its partner Tullow Oil, which also has a 50 per cent equity stake in the project, would need to demonstrate that the field could produce at least 400 million barrels of oil to justify the cost of building such a pipeline. Richard Griffith, an Evolution Securities analyst, said the latest discovery “thrashed” this commerciality threshold.

Source
http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article5512531.ece

It is quite a big find.

Uganda's Discovered Oil Reserves Hit 1 Billion Barrels


Oil reserves discovered so far on the Ugandan side of the Lake Albert rift basin are estimated at 1 billion barrels, the New Vision newspaper reports Thursday.

The state-owned paper quoted Nadheem Hashmi, the well engineering manager of U.K.-based Tullow Oil PLC as saying that with many more prospects to drill in the Butiaba region and across the base, the commercial threshold for development would be exceeded.

"The region has about 1 billion reserves of crude oil, this makes the project commercially viable," he was quoted as saying.

Tullow oil has assigned a team to make a commercial development plan for the whole basin, according to the newspaper.

Since 2006, Tullow oil and Heritage Oil Corp. have been drilling a number of oil wells on the Ugandan side of the Albertine rift.

Uganda is set to start on an early oil production scheme in the fourth quarter of 2009 with an initial production of around 5,000 barrels a day. Uganda expects to reach full-scale oil production in the next five to six years.

http://www.rigzone.com/news/article.asp?a_id=71232

The source of my last post is above.

The only good news that I can take from this is the fact that Joseph Kony is definitely a dead man because of this.  Look at how fast Savimbi was taken out in Angola. Botswana is the only African country that deserves to hit it big when it comes to oil. Seriously if they hit it big when it comes to oil say hello to the first Black First Nation.

Only if we had a country to learn from when we discovered oil. . . now other countries have learn from us.

The only good news that I can take from this is the fact that Joseph Kony is definitely a dead man because of this. Look at how fast Savimbi was taken out in Angola. Botswana is the only African country that deserves to hit it big when it comes to oil. Seriously if they hit it big when it comes to oil say hello to the first Black First Nation.


War is already brewing between DRC and Uganda. The oil is lake Albert, the eastern part of the lake is in Uganda, while the western part of the lake is in the DRC. There is argument about where does the Ugandan side end and where does the DRC starts.

DRC has enough resources to make all other African country's resources look like chicken shit if properly exploited. If a war does break out you know that Rwanda and Uganda will just gang-up on DRC and install another jackass warlord in the step of Laurent Nkunda.

Interesting. I wonder if all nations in Africa would be an oil-producing nation?

By the way, Nigeria is the laughing stock of the world. Grin I mean, we are like the Michael Jackson and Mc Hammer of the world, when it comes to managing our resources. We are just useless at it.

Yeah I mentioned it. Bite me.

@ElRazur,
the most important thing abt truth is to say it no matter what ppl will say or do.
if u want to be frank, oil is a course in disguise.
nigeria needs rebranding over her leaders and managers.

chidichris:

@ElRazur,
the most important thing abt truth is to say it no matter what ppl will say or do.
if u want to be frank, oil is a course in disguise.
nigeria needs rebranding over her leaders and managers.

I agree.

Oil is looking more and more like a cures in most developing countries that have them. In the case of Nigeria, it appears we have been cursed for generations to come now.

As for re-branding, you cant do much unless of course one changes the mentality of the people. It aint gonna happen overnight and it would take years to re-educate the masses. Until then, any talk of rebranding simply will not work.

Tullow fails to hit oil and abandons Uganda well:

http://www.independent.ie/business/world/tullow-fails-to-hit-oil-and-abandons-uganda-well-1753252.html


Oil War: http://www.strategypage.com/qnd/uganda/articles/20090612.aspx