The cumulative investments in the oil and gas sector stood at over
7.5 billion dollars by the end on 2023 says the Petroleum Authority of Uganda.
Peninah Aheebwa , the Director Economic and National Content Monitoring
at the Petroleum Authority Uganda (PAU) reveals that as 2024 comes to the end,
the companies have spent or are spending 2.9 billion dollars.
“We still expect an expenditure of around 2.3 billion dollars.
Again, we expect significant expenditure during operation,” says Ahebwa as she
accounted to Ugandan how the industry has progressed since February 2022 when
the oil companies made the Final Investment Decision for the Tilenga, EACOP and
Kingfisher projects.
She reveals that the Authority expects up 15 Billion dollars in
capital expenditure on the projects during the development and production
stages of the sector.
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The projects in the Upstream
Tilenga Project has nine fields with an estimated capital
expenditures of $4-5 billion, while the Kingfisher Development under CNOOC
Uganda Limited with three fields with an estimated an estimated CAPEX of $3-5
billion.
The ECAOP project is expected to sink in about $5 billion, while the
refinery will be constructed at about $4 billion.
There over one thousand
contractors and subcontractors linked to the Tilenga, Kingfisher and the EACOP
projects since FID in 2022.
The Petroleum Authority of Uganda is partly charged monitoring
the expenditures ad costs being incurred by the oil companies because they will
be recovered when production of oil begins.
PAU regulates the upstream and the midstream aspects of the
sector.
It mainly deals with the oil and gas resources management, ensures that
all operations are cost efficient. It is also in charge of the petroleum data, it
is also in charge of health, safety, security, socials and the environment
aspects of the sector and linking the oi and gas sector with other sectors of
the economy.
Procurement since FID
Aheebwa Ahebwa revealed that around five thousand two hundred and eighty
procurements have been undertaken by the licensees since FID. “And these were
worth 5.3 billion dollars. Out of these, four thousand five hundred and eleven procurements
went to Ugandan companies worth 2.1 billion dollars. And that is aroid 40% in contract
value,” she said.
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A key message from the development so far is that Ugandan
companies should consider entering joint ventures partnership local or with
international companies if they are to take up contracts or sub contracts in
the sector.
Some of these opportunities are coming up under the Uganda
National Oil Company (UNOC) which has an active license in the Kasuruban exploration
area. The government is also planning another licensing round for other blocks
with in the Albertine graben.
Joint Ventures
in Oil and gas
Aheebwa expressed hope that with joint ventures, probably knowledge
and technology will be transferred to Ugandans Ugandan Companies.
“So to date, we have approved
around 64 joint ventures. And 35 of these have been able to secure work in the
sector with a value of around three hundred million dollars,” Ahebwa revealed.
Some Ugandans companies have joined Joint Ventures with
Nigerian companies that are venturing into exploration.
“We need to do little
bit more because I know that that Nigerian companies are going into exploration.
And a good number of them are operators and they are managing marginal fields.
So I think we need to embrace joint ventures. Offering services is good but we also
need to go into exploration,” suggests Ahebwa.
Opportunities in the exploration area are mainly for those that
may wish to join the companies who were awarded exploration licenses.
New entrants can farm in those licenses by taking up shares.
Even when the government has not announced the next round competitive of
bidding of blocks, which does not mean that companies holing licenses are prevented
from negotiating within in the sector or to farm-in/farm-out.
Aheebwa said as part of technology transfer, PAU has been encouraging
the licensees to equip some of the country’s oil and gas training institutions.
“And so some of the licensee have supported the universities with software and hardware
to a tune of over two hundred thousand dollars”
Oil and gas jobs
According to Ahebwa, 90% of 15000 that are directly employed
in the upstream segment of the sector are Ugandans.
According the PAU, 64% of those being employed
are in managerial positions, 85% of the technical jobs are occupied by Ugandans,
and the others are 99% in terms of occupancy.
“Out of those direct jobs, in our computations we know every
direct job produces around 2.3 times indirect jobs and around three times
induced jobs. So out of the1500 jobs that have been created, we think the
industry has also created 34000 indirect jobs.” said Ahebwa.
PAU further estimates that over one hundred thousand induced jobs
have so far been created by the industry.
It is anticipated that the indirect and induced jobs are occupied by
Ugandans.
In preparation for the operations phase, Ahebwa revealed that
the oil and gas companies are undertaking what she describes as “massive” open inline
courses or training.
“As we speak there is aggressive training of two hundred Ugandans
that will be participating in the operations phase. I know you have heard of the
Tilenga Academy and the EACOP Academy in Uganda and Tanzania“
