KAMPALA – The ministry of Energy needs $5 billion (about UGX18 trillion) to drill over 500 oil wells in the Albertine Grabben.
The two oil wells are in Kingfisher and Tilega fields, which are currently a subject of a tax dispute between the government and three oil companies.
The Energy Ministry Permanent Secretary, Mr Robert Kasande, is quoted by Bloomberg as saying that the money will also be used to build two central processing facilities and a water plant.
He said the amount is part of the $15 billion to $20 billion that the government anticipates will flow in about four years to its nascent oil industry, including a refinery and crude pipeline.
Mr Kasande added that Uganda will in March call for applications to other firms that wish to explore other five oil blocks.
Uganda’s bid to produce oil has been pushed forward a number of times due to lack of adequate infrastructure and disagreements over taxes with companies.
Government is currently locked up in a tax dispute with Tullow Oil, Total and China’s CNOOC over the construction of the 1,443-kilometer-long (897 miles) crude oil pipeline.
There is no breakthrough in talks yet, Mr Kasande is quoted by Bloomberg as saying.
“In Uganda, Joint Venture conversations with the Government are ongoing. Tullow remains committed to reducing its equity stake in the project ahead of FID,” the company said in its trading update on Wednesday.