- Uganda will not begin oil production this year, missing a long-standing target to begin extracting crude from its western fields this year.
- According to government geologists, the fields are estimated to contain 6 billion barrels of crude reserves.
Uganda will not begin oil production this year, missing a long-standing target to begin extracting crude from its western fields this year, a government spokesperson said.
“Due to unforeseen challenges, we are unable to meet the above target,” Patricia Litho, a Ministry of Energy and Mineral Development spokesperson, said.
She did not give a reason for the country’s failure to meet the 2025 target and said a new date for production to begin has not yet been announced. Uganda discovered commercial reserves of petroleum in the Albertine rift basin near its border with the Democratic Republic of Congo nearly two decades ago.
Hurdles, including disagreements with international oil firms over taxes and development strategy and slow progress in the construction of the requisite infrastructure, have repeatedly delayed the start of production.
According to government geologists, the fields are estimated to contain 6 billion barrels of crude reserves. France’s TotalEnergies and China’s CNOOC are developing them. The two firms, alongside the Ugandan and Tanzanian governments, are also developing a $5 billion pipeline to help export the crude via a port on Tanzania’s Indian Ocean coast.
While the delay is disappointing, the production of oil in Uganda will dramatically transform the economic landscape of the country and the East African region as a whole. The potential impact on government revenue is substantial, offering a significant opportunity for Uganda if the proceeds are wisely invested in critical areas such as infrastructure development, agricultural modernisation, and human capital enhancement.
With approximately 1.4 billion barrels of Uganda’s 6.5 billion barrels of proven oil reserves estimated to be economically recoverable, the country stands on the brink of a major economic shift. These reserves, primarily located along the western border with the Democratic Republic of Congo, represent just the beginning of Uganda’s oil exploration journey.