KAMPALA, Uganda - The Ugandan government is planning to auction at least 13 oil blocks in the Albertine Rift Basin this year as soon as the government lifts a ban on the licensing of new acreage, Uganda's junior energy and minerals minister said Wednesday.
Peter Lokeris said the planned auction will allow international oil companies to bid for exploration acreage in the basin, where existing companies have discovered deposits of as much as 3.5 billion barrels of crude oil.
The government has demarcated a total of 17 oil blocks in the region, Mr. Lokeris said. Four of the blocks were licensed before Uganda imposed a licensing ban on new acreage in 2007. The remaining blocks will be auctioned as soon as President Yoweri Museveni enacts a new law lifting the licensing ban.
"Competitive rounds for new acreage will be guided by the new petroleum...some of the acreage previously licensed to oil companies has been returned to government through relinquishment requirements and the expiry of licenses" Mr. Lokeris told Dow Jones Newswires on the sidelines of an oil conference in Kampala, the Ugandan capital.
The licensing round will be Uganda's first since it imposed the ban in 2007, which was put in place following the confirmation of commercial oil reserves. Oil exploration companies have since made a flurry of discoveries in the country, increasing the size of Uganda's oil reserves from around 300 million barrels in 2006 to 3.5 billion barrels to date.
Mr. Lokeris said oil exploration companies operating in the Lake Albertine Rift Graben have had a success rate of around 87%, finding oil in 76 oil wells out of the 87 wells drilled so far.
"Preparations for development of some of these discoveries is ongoing before production can commence...This is an exciting time for the country" he said.
Companies with licenses in the country so far include U.K.-based Tullow Oil PLC, France-based Total SA and China's Cnooc Ltd. The three companies are planning to invest around $10-12 billion to develop oil fields in four blocks as Uganda continues plans to join the ranks of African oil producers.
Companies such as Italy's Eni SpA, Russia's Lukoil Holdings, and India's Essar Oil Ltd. have expressed interest in acquiring oil licenses in the country.
Copyright (c) 2012 Dow Jones & Company, Inc.
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