South Africa eyes Uganda’s oilfields

Kampala

President Jacob Zuma said yesterday that Uganda’s recent discoveries of commercial oil reserves present new investment opportunities for South African companies already playing a key role in the country’s telecom, banking and beverages sector. The President’s comments came shortly before President Museveni announced that Uganda is set to commence a new round of oil licensing for unlicensed blocks and relinquished acreage, after July this year.

Oil agenda
Speaking at the South Africa-Uganda business forum in Kampala, organised by the Uganda Chamber of Mines and Petroleum, President Zuma told his audience of mainly top business personalities that South Africa is considering creating new linkages with Uganda in the energy, oil and gas sectors.

“There is need to strengthen further the economic relations between Uganda and South Africa for the benefit of both countries,” he said. President Museveni said the government is in the final stages of creating a new legal framework to spell out appropriate management procedures of Uganda’s oil resource as the country joins the elite league of oil producers.

“We are ready to resume fresh licensing and we have many incentives for prospective investors which include freedom for the repatriation of earnings,” he said, suggesting that investors will be able to repatriate up to 100percent of their profits.

New frontier
With more than 800 million barrels of crude oil discovered in Uganda’s Lake Albert basin and an intensive ongoing exploration campaign, Mr Fu Chengyu, the CEO of China National Offshore Oil Corporation, told delegates that Uganda has become a new frontier in the African oil industry.

“China’s rapid economic growth guarantees a long-term reliable market for Uganda,” he said in his key note address, adding that as the second largest market of petroleum products in the world, China will also give Uganda a ready market for its oil once the country starts oil production.

President Zuma also called for the creation of a permanent joint trade commission between Uganda and South Africa to strengthen bilateral trade relations between the two nations before pledging that South Africa would use its position as the world’s fourth leading mining country to help Uganda grow its budding mining industry.