Oil refinery compensations: A mixed bag of hope, despair for residents

A total of 7,018 residents in 13 villages of Kabaale Parish will leave to give way for the construction of a 60,000 barrels of oil per day refinery. While the people are not opposed to the refinery, a visit to the area reveals mixed reactions regarding the compensation.

Tuesday March 4 2014

Part of the Kigogole oil well. The government wants to construct a refinery to cater for the country’s domestic fuel needs.

Part of the Kigogole oil well. The government wants to construct a refinery to cater for the country’s domestic fuel needs. PHOTO BY Isaac Imaka. 

By Isaac Imaka & Frederic Musisi


Kabaale can easily come out as a lonely hard-to-reach area. A big part shrub, human settlements are randomly clustered at a reasonable distance from each other and the 13 villages are accessible by skinny foot paths that fall off the only main laterite road and snake through sun burnt hedge plants to different homesteads.

According to the Ministry of Energy Permanent Secretary, Mr Kabagambe-Kaliisa, the year 2015 has been earmarked for the start of the refinery construction and 2017 is projected to see the first phase (30,000bpd) of the refinery project to be done.

At full implementation of the Resettlement Action Plan (RAP), the area will have not only Uganda’s first oil refinery but also an aerodrome, waste management facilities, associated industries such as petrochemical industries and staff quarters. It is supposed to dictate the new face of Hoima, the oil city.

There are two categories of beneficiaries; those who chose monetary compensation and those who chose to be relocated. However, everything is not fine in the two groups. The government has started paying, directly from Bank of Uganda, those who chose the option of compensation and on receipt, the recipient is given a three months’ notice to vacate the land.

Contested valuations and refusal to sign
However, a visit to various affected homesteads revealed that while the clock is ticking on the RAP (one year to go), there are countless squabbles over compensation being given for land and farm produce and those who chose to be relocated claim they are yet to know their destination.

Mr Jovan Owonda, 46, has 12 children and lives on one-and-half acres although he claims to have more land elsewhere. His two wives live in two separate huts adjacent to each other, each with her portion of children.

When we visited his home, at around midday, he was sitting under a jackfruit tree shade, shirtless and biting off a piece of freshly peeled cassava. His two wives were each at their huts going on with the chores— one sitting on her hut’s verandah peeling cassava and the other fighting soot off what looked like her cooking pot.

Mr Owonda is one of the many who have refused to put pen to paper. He rejected Shs20 million which was being given for the one-and-half acre piece of land, all his property inclusive. He contests the valuation rates. “I am not pleased with the way my property was valued,” he said. “I should at least get Shs100 million. “I know the project will change the image of this area but they should give us money which will enable my family get a better life,” he said.

Apart from the jackfruit trees and two huts, most of his land has pineapples and coffee trees. He says the government wants to give him Shs399 per pineapple plant yet the market value is Shs2000, and his coffee trees, he says, are being valued at Shs800 each.

The time it takes to walk from his home to the main road and back, is not enough for a meal. That, he believes, should make his land and crops fetch more money, just like plots in the nearby Kitegwa village. An acre of land in villages outside the refinery area goes for Shs15 million.

The project coordinator, Mr Bashir Hangi, says compensation rates for crops and semi-permanent structures are set by the district while the price for land is determined by the prevailing market value.

Payment queries
“These rates were determined by the professional valuers and approved by the Chief Government Valuer in the Ministry of Lands, Housing and Urban Development. Our officers on ground have no mandate to change compensation rates other than bringing such matters to the attention of the relevant officials which they have been doing.

“Those who accepted government awards have started receiving payment while those who have not yet accepted have not been forced. Accepting compensation is voluntary and no one is being forced or intimidated,” he said in an email.

Mr Richard Olebi, 27, says although he chose relocation, they are yet to know where they will be moved. “People who chose payments are being paid in halves and some are not but for us, we are not even sure of where we will be taken,” Mr Olebi said. “They just told us that they will give us a house of three bedrooms. They (government) promised to return and take us to inspect the land but they have never returned,” he said.

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