By Nicholas Bariyo
Seventeen oil companies, including South Africa's petrochemical
company Sasol Ltd. (SSL) and India's ONGC Videsh, have been
selected for the second round of the country's first competitive
oil bidding program for at least six blocks, which will be awarded
this year, the energy and minerals ministry said Wednesday.
The 17 were selected from a list of 19 companies that expressed
an interest in the first bidding round, which was announced in
February, Fred Kabagambe-Kaliisa, the ministry's permanent
secretary said in a statement.
The contracts for the blocks will be awarded this year with the
companies going forward from the second round to be announced in
August.
Uganda aims to attract more investors in its fledging oil
industry. Oil companies have discovered at least 6.5 billion
barrels of crude oil, from about 20% of its oil region, rendering
the country's crude fields the third largest by reserves in
sub-Saharan Africa after Nigeria and Angola.
"The six blocks on offer presents great opportunity to discover
additional resources that will enhance the country's sustainability
of oil and gas production and commercialization." Mr.
Kabagambe-Kaliisa said.
Other bidders to go to the second round include U.K.'s Tullow
Oil PLC (TLW.LN), Petoil Ltd. of Turkey, Rift Energy Corp and Glint
Energy LLC from the U.S., Russia's Africa Global Resources and
China's Brightoil Petroleum.
The blocks on offer lie along Uganda's western border with Congo
and include at least four lucrative discoveries, relinquished by
the existing oil companies this year.
Last week, Uganda resolved a long standing tax dispute with
Tullow and analysts believe the development of the sector will now
move faster after years of delays.
Tullow along with China's Cnooc Ltd. (0883.HK) and France's
Total SA (TOT) are already developing the country's confirmed
reserves, where they expect to deliver around 40,000 barrels-a-day
of initial crude in 2018. The country expects to reach peak output
of around 220,000 barrels a day by 2022.
The East African region has been a hotspot for oil and natural
gas exploration following a flurry of oil and gas discoveries in
Uganda, Kenya, Tanzania and Mozambique.
Write to Nicholas Bariyo at nicholas.bariyo@wsj.com
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