The Uganda National Oil Company (UNOC) chief executive officer, Ms Proscovia Nabbanja, on Tuesday told Parliament’s Finance Committee that her docket needs Shs640b to support and manage the company investments.
Ms Nabbanja said the money will help the company deliver on their mandate for different projects such as the refinery, the East African Crude Oil pipeline as well as other business lines on schedule.
She, however, clarified that the money is not necessarily needed all at once, considering the different project schedules and when the cash calls will be coming in.
Ms Nabbanja, who was presenting the company’s budget policy statement for the Financial Year 2021/2022 to the committee, also decried underfunding by government.
She said they have been allocated Shs48b for the next financial year out of the Shs129b that they had requested, leaving a huge funding gap.
Ms Nabbanja said areas that need critical funding yet are underfunded include joint venture activities, the ICT infrastructure and support services that require field operations.
“On the operational side, we need about Shs129b to support the activities of the company and manage the investments we are going to make. We are working with the Ministry of Finance to see that we get the requisite financing in order to protect the value for the state,” Ms Nabbanja said.
“We need to strive and see how we can get more money to support our operations based on the facts that after signing these agreements, there is going to be a ramp up of activities in the field and UNOC, as a commercial entity of the state, needs to be part of the process to protect the state’s interests,” she added.
Her submission prompted the committee chairperson, Mr Henry Musasizi, to inquire from the Finance minister, Mr Matia Kasaija, who was in the same meeting, supporting her submission, wondering why government struggles to fund the sector and yet it is crucial.
He asked MPs to make oil and the gas sector financially independent.
“Companies of this nature should be given capital instead of annual budgets. Give them capital so that they go and plan for themselves then eventual give you their performance report,” Mr Musasizi said.
Mr Kasaija said it is part of the plan as several other requests in his docket are still being sorted.
“That is our plan but the problem is funds. I do not have the resources to fund each and everything on demand but we are considering that,” he said.
This comes at a time when government and international oil firms successfully sealed a deal to kick start oil production.
The government, French Total E&P, and China’s Cnooc on April 11 signed off four key agreements for commercialisation of the proposed East African Crude Oil Pipeline , bringing to end years of prolonged negotiations and setting on course Uganda’s oil project for the next phases of development and production by 2025.