US Ambassador to Uganda Deborah Malac : COURTESY PHOTO

The US Ambassador to Uganda Deborah Malac has urged the Ugandan government to use proper procedures in the development of its oil and gas sector so as not to fall prey to the problems that other mineral rich countries face.

The ambassador, while Speaking to a delegation on the contract, transparency and accountability in the attractive sector said that the parties involved should be aware that much as oil and gas is a very useful mineral, it can have permanent impact on the people and land and that it is not a shock that  29 of the 51 countries classified by the International Monetary Fund as “resource-rich” are actually low- or lower-middle income countries.

“The industry requires heavy investments of capital, time, and technology.  The sheer scale of these efforts to move mountains and reshape the ground beneath our feet takes great resources, and has the potential to generate large revenues.  Likewise, the costs of mismanagement, malicious or otherwise, can quickly escalate.  These revenues can be a powerful driver for corruption and unrest.  Across the world and throughout history, mineral wealth has often served to undermine democracy, create violence, and increase inequality,” She remarked.

She however hailed  the “government of Uganda for its past efforts to reform policy and law to make the extractive sector transparent and accountable.  I also wish to thank civil society actors—ACODE and others—for the engagements you have had and continue to have with government and private sector to enhance transparency and accountability.”

Read full remarks by the ambassador HERE

The dialogue was organized by the Advocates Coalition for Development and Environment

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Map showing Albertine Graben oil fields in Uganda

The Prime Minister Dr Ruhakana Rugunda has called upon investors and other stakeholders in the oil and gas sector to continue working together closely to expedite the development of the oil and gas sector in the country. The Premier made the remarks at the joint meeting of the policy coordination committee and the oil and gas technical working group to review progress on the implementation of the Presidential Investors’ round table phase four at the office of the President.

The Prime Minister Dr Rugunda called the meeting to discuss key issues that emerged from the review meeting held at State House Entebbe in March this year. Some of these issues include issuance of petroleum production licences to licenced oil companies as well as the legal and policy framework on local content for the oil and gas sector.

The oil companies argue that they are entitled to full blocks not less than five minutes by five minutes grids wherever they have made a petroleum discovery. They also want areas crossing exploration boundaries into unlicensed areas to be licenced as one unit by adding them to the discovery made. A total of 8 applications for issuance of production licences by Total and Tullow have been submitted to government.

According to the Minister for Energy and Mineral Development, Eng. Irene Muloni, the Attorney General has guided that part of a block will be issued to cover extent of discovery as defined by appraisal.

Also discoveries crossing exploration boundaries where there is pressure communication between discoveries made by two licenced companies on either side will be licenced to the two parties through unitization. Four sets of regulations under general, health safety and environment, metering of petroleum and national content have been developed under the Petroleum Exploration, Development and Production Act 2013.

The Chairman of the oil and gas technical working group, Herman Kasekende thanked Government for resolving the issue of value added tax on investments and also applauded Government for addressing the issue of infrastructure in the Albertine graben.

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