State petroleum agency has announced that Uganda will commission the first of its four planned oil drilling rigs and start drilling its first oil well in the Kingfisher oil field on Tuesday, January 24, 2023.
This is a key milestone as it is hoped that by 2025, the first of a potential 1.4 billion barrels of oil will be pumped from wells across the mid-western region.
Uganda has been keen on fast tracking its oil programs since last year, and has signed a couple of deals to this effect.
Last year, Uganda and its collaborators, TotalEnergies and Tanzania got into a disagreement with the European Union over a pipeline project, which the EU declared environmentally harmful. The European Union parliament noted that the project could also destroy the only source of usable water for the locals in the area.
Despite this, the country insisted on going ahead with its oil exploration. Ugandan President, Yoweri Museveni reiterated his intent and even noted that he is willing to go in another direction should his current partners change their minds.
“The project will continue as stipulated in the contract we have with TotalEnergies and CNOOC (China National Offshore Oil Corporation). TotalEnergies has convinced me on the pipeline idea; if they choose to listen to the European Parliament, we will find another partner to work with. In any case, our oil will be extracted in 2025 as planned. So the people of Uganda need not worry.”
Uganda’s President, Yoweri Museveni
As recently as this month, the East African country signed production-sharing agreements (PSA) for two oil exploration blocks between two oil firms, including a unit of Australia’s DGR Global (DGR.AX). Once again reiterating its commitment to making oil a major revenue stream for the country.
“Today we mark another milestone and move a step closer to first oil with the launch of the drilling of development and production wells for the Kingfisher oil fields.”
The Ugandan Petroleum Authority
The organization also disclosed that the President of the country, Yoweri Museveni, has been scheduled to officiate the launch at the Spudding (drilling) site in Kingfisher project area, one of the country’s two commercial oil development areas.
Through this project, Uganda plans to eventually produce about 230,000 barrels of crude oil per day.
According to Uganda’s Ministry of Energy and Mineral development, the rig will be used to drill a total of thirty one wells in Kingfisher while three rigs to be deployed later in Tilenga project area will drill a total of four hundred and twenty-six production wells.
Uganda Has Been Slow To Explore Its Oil Reserves
Uganda for over two decades has discovered massive oil reserves within its borders, which the country had been slow to explore.
However, the energy scramble of 2022, triggered by the Russia-Ukraine conflict, presented an opportunity to fill a market gap, which Uganda simply could not ignore.
Also, a lack of infrastructure made it impossible for the country to fully delve into crude oil exploration. However, this issue seems to have been resolved due to the partnership.
The Kingfisher oil field is operated by China National Offshore Oil Corporation(CNOOC), while the second Tilenga oil field is operated by France’s TotalEnergies.
Under the waters and on Lake Albert’s shores, a 160km natural barrier separating Uganda from the Democratic Republic of Congo, lies the equivalent of 6.5 billion barrels of crude oil, of which about 1.4 billion barrels could currently be recovered.
Uganda’s reserves can last between twenty-five and thirty years with a peak production estimated at 230,000 barrels per day.
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