KAMPALA- Tullow Oil PLC (Uganda) is committed to the Ugandan oil and gas industry and will not cease its operations here, officials have clarified.
The British exploration company in an email response to a number of questions raised by this newspaper, said it is fully committed to the Uganda project for a long term.
“No consideration has been given to any scenario or option other than a long term partnership with Uganda that delivers shared prosperity and benefits for the country and the company,” the company’s deputy spokesperson, Mr David Onyango, said.
The company was reacting to suggestions in the industry that Tullow planned to exit oil operations in the Albertine Graben, which explains why they had not yet acquired a production licence.
Daily Monitor has also established from reliable sources within the government that “delay” to issue an oil production licence to Tullow has more to do with its basin-wide approach with its partner Total E&P, yet government would prefer the firms work independently.
The Chinese firm, CNOOC, was in September issued a production licence yet its application was made after Tullow’s.
However, Mr Onyango said Tullow currently has four Field Development Plans (FDPs) under review by the Petroleum Exploration and Production Department (PEPD), and this number could increase to five by the end of 2014.
“We have received useful comments from PEPD in respect of our Field Development Plans, to which we are preparing a response. We hope we will be granted a production licence in 2014.”
The company also said it sees the first batch of oil produced in 2019 after infrastructure, like a 60,000 barrels-per-day refinery and a crude oil export pipeline, have been put in place.
“Tullow and its partners fully support government’s objective to build an optimally sized refinery alongside an export pipeline. The achievement of a Final Investment Decision for the refinery will help make the timelines clearer for the start of production,” said Mr Onyango.
The government is currently receiving Statement of Qualifications from appropriately qualified investors to facilitate the development of the refinery in a Public Private Partnership of ratio 60:40, while the four other East African states will each have a 10 per cent stake.
“A refinery sized to meet Uganda’s local demand is of strategic value to the country and can be developed parallel to the crude export pipeline. This approach will trigger maximum benefit to the wider Ugandan economy and has our support,” the company said.
Tullow has so far invested more than $2 billion (about Shs5 trillion) in Uganda’s oil sector.