Uganda’s proven oil reserves may hit 6.5 billion barrels amidst new exploration

Uganda is conducting oil exploration in two additional regions that could boost the country’s proven reserves beyond the current 6.5 billion barrels.

Commercial crude oil deposits were first discovered nearly two decades ago in the Albertine Graben basin, located in western Uganda near the Democratic Republic of Congo border, Reuters reported.

As the country inches closer to becoming an oil-producing nation, it generated an additional Shs44 billion from oil tax revenues during the June 30, 2023 financial year.

The production of crude is not expected to commence until next year.

Government geologists are currently conducting exploration in two new regions in northern and northeastern Uganda, Energy Minister Ruth Nankabirwa announced during a press conference held in the capital, Kampala.

“The ministry is conducting preliminary petroleum exploration studies in the Moroto-Kadam Basin to assess its oil and gas potential. Similar surveys have started in the Kyoga Basin,” she said, referring to the two new regions.

“Early results suggest the potential for commercial oil and gas in the Moroto-Kadam Basin.”

Uganda has identified five basins with hydrocarbon potential, though only one, the Albertine Graben, has been successfully explored to date, according to the energy ministry.

Within this region, the two main oil fields—Tilenga and Kingfisher—are largely controlled by TotalEnergies, which holds a 56.7% stake, while China’s CNOOC and Uganda’s national oil company, UNOC, own the remaining shares.

Despite the discoveries, commercial oil production has faced significant delays. Disagreements over field development strategies, taxation, and a lack of necessary infrastructure and funding have all contributed to postponements.

To date, only 72 of the planned 457 wells in the Tilenga and Kingfisher fields have been drilled.

Uganda is now focusing on securing Chinese funding, including from EXIM Bank and SINOSURE, to help finance the 1,445-kilometer (895-mile) East African Crude Oil Pipeline (EACOP), which is designed to facilitate the export of Uganda’s crude oil via Tanzania’s Indian Ocean port.