Uganda's Oil Reserves Hit 3.5 Billion Barrels Mark

3365 Views Kampala, Uganda

In short
The volume of Uganda’s oil reserve has increased from 2.5 to 3.5 billion barrels following latest discoveries at three oil wells in the Paara discovery area, a commissioner in the ministry of energy has said. The latest addition means the country is in a better position to meet its oil consumption demands and also support its national budget from the oil revenue once the production begins.

The volume of Uganda’s oil reserve has increased from 2.5 to 3.5 billion barrels following latest discoveries at three oil wells in the Paara discovery area.
 
Ernest Rubondo, a Commissioner in the Petroleum and Exploration Department that is responsible for the oil industry said the increase in the oil volume was due to new discoveries at the newly drilled wells at Gunya, Bio and Jobi East in addition to appraisal at the previously discovered oil fields. Gunya, Bio and Jobi East oil wells are located in the Paara discovery area where TOTAL Exploration and Production Company is the main operator alongside Tullow Uganda and CNOOC Uganda.
 
The latest addition means the country is in a better position to meet its oil consumption demands and also support its national budget from the oil revenue once the production begins.
 
Rubondo explained that a total of 77 oil wells have been drilled to date out of which 70 encountered oil and gas, signifying a ninety percent success rate compared to the international average rate of ten percent. He said only 40 percent of the areas with potential to have oil have been explored.
 
He added that a total of 1.5 billion dollars has been spent during the ongoing exploration placing the cost of discovering one barrel at less than a dollar compared to the world’s average cost which he said stands at between 5 to 20 dollars a barrel.
 
The Commissioner said that government intends to begin production of the oil in 2015 with an initial production volume of 3,000 to 5,000 barrels per day that would increase gradually to 60,000 barrels per day over the years. He said the strategy would allow government to begin by constructing a refinery of a lower capacity and expand as production progresses.
 
He also said 80 oil companies have applied for oil production licenses whose approval has been put on hold until proper legislation is passed.
 
//Cue in: “Once you have…
Cue out: …no more licensing.”//
 
The latest addition of Uganda’s oil reserve volume to 3.5 billion barrels increases its ranking among the world’s oil reserves. However, it is minimal compared to the reserves of world leading oil producers such as Russia, Saudi Arabia and United States of America that have proven oil reserves of 60 billion barrels, 265 billion barrels and 19.1 billion barrels of proven reserves respectively.