Uganda Expects First Oil Production in 2021

Uganda expects to start producing oil in 2021, a year later than initially planned, and its refinery should be up and running by 2023, its oil minister said on Thursday.

France's Total is an investor in Uganda's oilfields, with China's CNOOC and Britain's Tullow Oil.

"Our initial target was 2020. That seems to have slipped and we are looking now at 2021," Irene Muloni said at the Africa Oil Week conference in Cape Town. That date is in line with industry targets.

In April Uganda signed a deal with a consortium, including a subsidiary of General Electric, to build and operate a 60,000 barrel per day refinery that will cost $3 billion-$4 billion.

Muloni said the refinery should be operational by 2023.

Uganda discovered crude reserves more than 10 years ago but the start of production has been repeatedly delayed by disagreements with field operators over taxes and development strategy.

Uganda initially said it would not produce oil until the refinery was complete but its timetable is now being driven by a planned export pipeline that will snake across neighboring Tanzania.

Muloni said she expected that to "come on line quickly. We are waiting for the companies to make their final investment decisions. The front-end engineering designs have been completed and we are just going through the processes of approval by the government."

She said she hoped it would be done before the end of 2018 but next year now looks more likely.

Total has indicated it is willing to partly fund the project. The pipeline is being developed as a public private partnership.

Government geologists estimate Uganda has crude reserves of 6.5 billion barrels in the Albertine rift basin along its border with the Democratic Republic of Congo.

Muloni said the success rate of finding oil there was over 85 percent "and the cost of finding oil in that place is less than a dollar a barrel."

(Editing by Susan Fenton)

Related Stories