Legal and Human Rights Dimensions of Oil Exploration

8/3/2019 Legal and Human Rights Dimensions of Oil Exploration

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Oil exploration in Uganda was first done by Wayland in the 1920s,who documented up to 52 oil and gas seeps in the AlbertineGraben.

Petroleum exploration activities seized due to the Second WorldWar in 1945

In 1983 geologists resumed exploration activities in the AlbertineGraben, revealing reasonable oil presence. This led to thecreation of the Petroleum Unit in 1985, in the Geological Surveyand Mines Department to spearhead exploration promotion;

In 1985 the Petroleum (Exploration and Production) Act wasenacted to make provision for the exploration and production of

petroleum and related matters. The Petroleum unit was replacedby the Petroleum Exploration and Production Department whichcommenced aeromagnetic surveys.

The Petroleum (Exploration and Production) (Conduct ofExploration Operations) Regulations 1993 were passed forregulating petroleum activities in the country.


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Ugandas sedemetary basins (with oil potential)include

a. Albertine Graben

b. Hoima Basinc. Kioga Basin (Around L. Kioga)d. Moroto-Kadamae. L. Wamala Basin

f. L. Victoria Basin Hoima, Kioga and Moroto are under

investigation to establish their potential L. Wamala and Victoria Basins were found to

be not prospective


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Albertain Graben has the highest potentialand this is where Oil exploration activitiesare concentrated

Stretching from West Nile to the south-western tip of Uganda covering an area ofabout 23,000 km2

The region is at the Board with Congo (DRC)

passing through several ecosystems (lakes,rivers, national parks, human settlementse.t.c.)

The area is divided into 10blocks/exploration areas (EA)


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Status of Licensing oilexploration in Uganda


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62 wells have been drilled so far, 58 of which have oiland 2 were dry = 92% success one of the best in theworld, 20 discoveries representing 40% of theAlbertain Graben

The discovered oil is of medium value with low gasratio (In Semliki the well established high gas ratio &was abandoned)

About 2.5 Bn Barrels have been discovered out ofwhich 1Bn can be extracted

About 7Bn Barrels of Gas Govt. plans to extract 100,000 Bdp = about 20years

extraction Govt. plans to set up a refinery in KabaleBuliisa

district


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Key human rights issues in the

proposed Oil & Gas Bill


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An Act to give effect to article 244 of the Constitution; to

regulate petroleum exploration, development and production;

to establish the Petroleum Authority of Uganda; to establish the

National Oil Company; to regulate the licensing and

participation of commercial entities in petroleum operations; to

create a conducive environment for the promotion andexploration of Uganda's petroleum potential; to provide for

efficient and safe petroleum activities; to provide for an open,

transparent and competitive process of licensing; to provide for

the refining, transportation and storage of petroleum and for the

processing of gas; to provide for the cessation of petroleumactivities and decommissioning of infrastructure; to provide for

the payment of royalties and payment of indemnities arisingfrom petroleum exploitation; to provide for the conditions for the

restoration of derelict lands; to repeal the Petroleum (Exploration

and Production) Act, Cap 150; and for related matters.


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From the long title it can be seen

a. The Bill deals with down and upstream

activitiesb. The Bill is congested with many things

that need to be separated

c. The Bodies created in the Bill are giventoo much workthere is need forspecialization


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The Petroleum (Exploration, Development, Production, andValue Addition) Bill was developed in 2010

Ownership of Oil and Minerals The Bill maintains the constitutional provision that the property

in, and the control of, petroleum in its natural condition in orupon any land in Uganda is vested in the Government onbehalf of the Republic of Uganda.

No person can lawfully carry out any exploration ordevelopment operations on petroleum in or upon any land inUganda without a license.

Implication of the Bill & Constitution: if oil is discovered in onesland, it belongs to the government and the land can beacquired compulsorily for public use under Article 26 of the

Constitution. Even though the Constitution protects the right of every

person to own land, compensation can easily be paid forany land acquired for oil exploration because of theeconomic benefits.


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Establishes National Petroleum Authority NPA)as indep.Body, however CL. 13 gives minister powers to givedirections to the NPA (Indep but not Indep)

No parliamentary involvement in employing key persons in

the sector No provision for NPA to report to parliament No provision for NPA to show revenues & Accountability No provision for National Petroleum Audit Cl. 158 subjects access to information to agreement

between GoU & Licencee contrary to Art. 41 of const. onaccess to information & the Access to Information Act

No provision for competitive open biding for oil companies


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Provision is made for high level of safetyin petroleum activities, requirements foremergency preparedness, safety zonesand suspension of petroleum activities inthe event of an accident. (Cl. 144, 146 &148)

However the duty for ensuring healthyand safety of workers is put on thelicensee without proper monitoringprocedures


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The Bill requires Oil exploration to be done inline with Environmental regulations inUganda

It prohibits environment-degradingpractices and provides that a license maybe cancelled if it causes significantdamage to public or private interests

affected by breach of the terms on whichit was granted.

Here Environmental Laws will be applied inOil


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Bill does not expresslyprohibit gas flaringwhich degrades theenvironment.(already flaring wasdone in Buliisa)

the challenge hasbeen the failure tofollow the laws andthe lack ofimplementationcapacity byAuthorities


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Provides for sharing of royalties 85% toCentral Govt & 15% to Local Govt.

However the Bill doesnt take intoaccount demands from Kingdoms andother stakeholderskingdoms & otherstakeholders need to be regulated to

ensure smooth operation of the industry Bill doesnt set standards that will ensure

revenue from oil will be used for nationaland equitable development


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Generally the Bill should not be rushed asugandans need to input in the Bill

The Bill should be divided into laws tomanage down streem and upstreamactivities

The Bill should be clear on all the abovementioned


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Documents

Legal and Human Rights Dimensions of Oil Exploration