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PROGRESS OF PETROLEUM EXPLORATION AND DEVELOPMENT IN UGANDA
Presented by
GLORIA SEBIKARI, SENIOR COMMUNICATIONS OFFICER
PETROLEUM EXPLORATION AND PRODUCTION DEPARTMENT
DIALOGUE WITH CIVIL SOCIETY ORGANISATIONS
“Enhancing Environment Compliance in Uganda’s Oil and Gas Sector
22nd JULY 2014
MINISTRY OF ENERGY AND MINERAL DEVELOPMENT
THE REPUBLIC OF U GANDA
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 2
1. Introduction
2. Status of the Sector
3. Policy, Legal, Regulatory and Institutional Framework
4. Commercialisation plans
5. National Participation
6. Environment management
7. Conclusions
PRESENTATION OUTLINE
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
1. INTRODUCTION 3
1.1 PETROLEUM POTENTIAL: UGANDA’S SEDIMENTARY BASINS
Albertine Graben
1
Hoima Basin
Lake Kyoga Basin
Kadam-Moroto Basin
Lake Wamala Basin
Lake Victoria Basin
Lake Edward
Lake George
LAKE VICTORIA
Lake Wamala
HOIMA BASIN
LAKE VICTORIA BASIN
LAKE WAMALA BASIN
LAKE KYOGA BASIN
KADAM-MOROTO BASIN
LAKE KYOGA
Sedimentary Basin in Uganda (Source: PEPD)
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LIBYAALGERIA
NIGERIA
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2
3
MOST PROSPECTIVE
UNDER INVESTIGATION
OTHER BASINS
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 4
• Four (4) Active Production Sharing Agreements (PSAs)
• 3 License Operators (Tullow, TOTAL and CNOOC)
• Change from small oil companies to super independent and major oil companies
2.1 ACREAGES/LICENCES
2. STATUS OF THE OIL AND GAS SECTOR
HERITAGE HARDMAN NEPTUNE DOMINION ENERGY AFRICA
© Petroleum Exploration and Production Department, Uganda 5
2.2 RESOURCE BASE
STATUS OF THE OIL AND GAS SECTOR
21 oil and/or gas discoveries made in the Albertine Graben
17 fields taken forward for appraisal
Appraisal for 13 of the discoveries completed, and applications for production license submitted
One Production Licence (Kingfisher) approved during September 2013
Appraisal of the remaining 4 discoveries still ongoing and is expected to be completed by end of 2014
116 exploration and appraisal wells drilled
102 encountered hydrocarbons
Over 3.5 billion barrels of STOIIP established
Over 1.2 billion barrels of recoverable petroleum resources
Over 80% of the Albertine Graben is unlicensed Discoveries in the Albertine Graben (Source: PEPD)
© Petroleum Exploration and Production Department, Uganda
STATUS OF THE OIL AND GAS SECTOR (2)
6
Appraisal Areas in the Albertine Graben (Source: PEPD)
TOTAL E&P Uganda B.V
• Appraising of four discoveries in EA1 and 1A • Submitted application for Production Licence
for 3 fields (Ngiri, Jobi-Rii)
Tullow Uganda Operations Pty Ltd
• Submitted application for Production License and FDPs for nine discoveries in EA2
CNOOC Uganda Ltd
• Field Development Plan and Production License for the Kingfisher Field approved during 2013
• Commencing development
2.3 STATUS OF UPSTREAM ACTIVITIES
© Petroleum Exploration and Production Department, Uganda © Petroleum Exploration and Production Department, Uganda 7
3. POLICY, LEGAL, REGULATORY AND INSTITUTIONAL FRAMEWORK
The National Oil and Gas Policy (2008)
Available on: www.petroleum.go.ug
NATIONAL OIL
AND GAS
POLICY
PETROLEUM
LEGISLATIONS
PETROLEUM
REGULATIONS PSA
POLICY
LAWS
• The Petroleum (Exploration, Development and Production) Act, 2013
• Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act, 2013
• Formulation of a Bill for the management of petroleum revenue (The Public Finance Bill) and the Bill is currently in Parliament
• Other relevant statutes and guidelines such as Environment , Wildlife, Water, Income Tax, land
• Petroleum (Exploration and production) (Conduct of Exploration Operations) Regulations, 1993
• New Petroleum Regulations expected in 2014 to address Exploration, Development, Production, HSE, NC among others
REGULATIONS
3.1 REGULATORY FRAMEWORK
© Petroleum Exploration and Production Department, Uganda © Petroleum Exploration and Production Department, Uganda
3.2 INSTITUTIONAL FRAMEWORK
Based on three critical pillars
• Resource - Ministry of Energy and Mineral Development - Petroleum Exploration and Production Department
• Environment – MWE, NEMA, UWA, DWRM, NFA, MLHUD, MAAIF
• Revenue – MFPED, URA, BOU, AGO, OAG
District Local Governments
Government Ministries, Agencies and Departments recognised in the NOGP (MoJCA, MoGLSD, MIA, UIA etc)
Other Stakeholders; Oil Industry, Development Partners, Civil Society, Media, Academia etc.
8
POLICY, LEGAL, REGULATORY AND INSTITUTIONAL FRAMEWORK
© Petroleum Exploration and Production Department, Uganda © Petroleum Exploration and Production Department, Uganda 9
POLICY, LEGAL, REGULATORY AND INSTITUTIONAL FRAMEWORK
Policy and Licensing
MINISTRY OF ENERGY
(DIRECTORATE OF PETROLEUM)
PETROLEUM AUTHORITY
Regulation of the oil and gas sector
Commercial and Business interest of the state
NATIONAL OIL COMPANY
MINISTRY OF ENERGY AND
MINERAL DEVELOPMENT
(PEPD)
Policy, Licensing, Regulation, Commercial
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 10
4. COMMERCIALIZATION PLANS
SHORT TERM
Use of crude oil and gas for power generation
MEDIUM TERM
Phased development of a 60,000 BOPD refinery
Commercialization of gas produced
Development of a crude oil export pipeline
LONG TERM
Potential expansion of the refinery
Development of petrochemical and energy-based industry
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
4.1 REFINERY DEVELOPMENT; PROGRESS
Acquisition of 29 sq.KM of land in Kabaale, Buseruka Subcounty, Hoima for refinery development through implementation of a Resettlement Action Plan (RAP)
Environment baseline survey has been completed
A Transaction Advisor (Taylor DeJongh from USA)is supporting the structuring of the refinery development and source a lead investor.
Refinery to be developed on a PPP basis
11
COMMERCIALIZATION
RFQ issued in October 2013 and six firms and/or consortia shortlisted, four responded to RFP and two shortlisted for negotiations.
SK Group and RT-Global Resources to present Best and Final Offers by end of Aug 2014.
The first phase of the refinery (30k bopd) expected in 2017/18 and 60Kbpd two years later.
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 12
• Studies for crude pipelines to the refinery and pipelines to evacuate the products from the refinery has commenced
• Crude Transportation Pipeline to refinery
Two routes (Northern and Southern) were identified
Northern route: 97km, 16-inch and,
Southern route: 46km, 12.5 inch
Cost of pipelines estimated at $185M
• Refined Products Pipelines from Refinery
1. A 205km long, 10 inch diameter pipeline
Distribution by trucks from Buloba to different demand centers
Cost of pipeline estimated at $307M
Proposed to be developed as part of refinery project
• Infrastructure to support development of the refinery and the oil fields is being put in place.
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Kibanda
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31°30'0"E
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U G A N D AU G A N D A
PROPOSED REFINERY INFRASTRUCTURE
D . R . C O N G OD . R . C O N G O
Legend
"" TOWNS
Central Processing Facilities
NAME
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PROPOSED PIPELINE ROUTE
Southern Route 1
Southern Route 2
Northern Route 1
Northern Route 2
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Proposed Refinery Land
County Boundary
Oil Discovery
International Boundary
Airstripp
Water Body
Licensed Areas
COMMERCIALISATION
4.2 PIPELINES DEVELOPMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 13
Refined Products Pipelines(Cont’d)
2. Eldoret-Kampala (Buloba) Pipeline
Feasibility study Recommended
A 325km long, 12 inch pipeline
3. Kampala-Kigali Pipeline: Feasibility study is being undertaken.
Crude Export Pipeline
Three possible routes were evaluated
Northern route to Lamu Port in Kenya, 1380km long
Central route to Mombasa, 1300km long
Southern route to Dar es Salam, 1950km long
The actual sizing of pipeline and detailed routing are being studied
Integrated infrastructure Development including regional discussions on joint infrastructure devt are ongoing
COMMERCIALISATION
PIPELINES DEVELOPMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
5. NATIONAL PARTICIPATION
14
Concluded a study on the opportunities and challenges for Ugandans’ participation in the oil and gas sector in September 2011. Copy of the study is on www.petroleum.go.ug
Recommendations of the study are under implementation
Development of a National Content Policy and Plan (draft is under discussion).
Establishment of a National Content section in the Department
Mobilization of local service providers; Association of Uganda Oil and Gas Service Providers
Regulation of expatriates; through work permit system.
Approval of organisation structures for oil companies.
Requirement to develop Nationalisation Plans for expatriate positions.
Streamlining the procurement procedures for oil companies.
PSAs provide for State Participation at 15% to 20%.
Several aspects of national participation have been legislated.
Capacity Building and Skills development with an emphasis on Vocational Skills Devt.
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 15
Employment of Ugandans
Local Enterprise Development
Measurement and Monitoring of
National Content
Enhancement of Vocational and
Higher Education training
Procurement of Local goods & services National
Content Development
5.1 Pillars of the National Content Policy
NATIONAL CONTENT POLICY (DRAFT)
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© Petroleum Exploration and Production Department, Uganda 16
5.2 Objectives of the Policy
THE NATIONAL CONTENT
POLICY
3. Develop the capabilities of Uganda
based firms as suppliers.
1. Build the capabilities of Ugandan human resources to
effectively participate in petroleum operations
2. Promote the use of locally manufactured goods and services in the petroleum sector.
4. Establish a transparent monitoring and reporting system to
assess achievements
NATIONAL CONTENT POLICY
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda 17
5.3 The interaction between several stakeholders is therefore key
NATIONAL CONTENT POLICY
National
Content
Education sector
Oil Companies
Oil Service companies
Local Private Sector
Government
Financial Sector
The draft national content policy and plan will be finalised by end of 2014 and it will be presented to stakeholders.
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
1. Right policies
• NOGP recognises importance of environment and biodiversity protection and
prescribes key strategies and actions to achieve this
2. Clear laws, regulations, guidelines and standards
• Environment laws and statues are respected and adhered to
• Update of critical laws, regulations and guidelines is ongoing
3. Strong institutions
• Creation of Oil and Gas units in Environment and Biodiversity Institutions
4. Qualified and skilled personnel
• Continuous Capacity building is undertaken
5. Effective monitoring and supervisory strategy
• Multi Institutional monitoring efforts
• Inspections and Audits are undertaken.
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6. ENVIRONMENT MANAGEMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
Enforce compliance with all applicable laws, regulations and
standards.
Ensure oil and gas operations are undertaken in a safe manner and
protect the environment and biodiversity
Ensure that incidents (accidents and near misses), are reported,
investigated and addressed.
Carry out incident investigations and analysis when required
Ensure implementation of acceptable waste management practices.
Participate in development and review of regulations, guidelines and
standards
19
ROLES OF HSE UNIT
ENVIRONMENT MANAGEMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
Daily HSE reports
Special reports from oil companies (Notices, Monthly Reports
and Quarterly Environment Monitoring Reports)
Daily operations update from the Department’s field
monitoring teams
Inspections and Audits
Regular engagements (Ops meetings, TCM & ACM)
Assessment of work plans and technical submissions (Well
proposals, Drilling program, Seismic survey plans, Field
Development Plans)
Review of EIAs and Environment Audits
20
TOOLS
ENVIRONMENT MANAGEMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
ENVIRONMENT MANAGEMENT
Environment and Social Impact Assessment studies are undertaken and Environmental Audits
done for ALL projects
Limiting the footprint: drilling pads, access roads, camps.
Avoidance of sensitive locations
Monitoring biodiversity in liaison with the Wildlife Authority
Restoration and decommissioning of sites
Jobi-1 Mputa-2
21
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
SITE RESTORATION AT JOBI-1 MURCHISION FALLS NATIONAL PARK
22
ENVIRONMENT MANAGEMENT
THE REPUBLIC OF U GANDA
© Petroleum Exploration and Production Department, Uganda
7. CONCLUSIONS
23
Uganda is moving forward to join the leagues of Oil Producing Nations since exploration and appraisal has been successfully undertaken .
Sustainable and balanced development is a priority of Government; frameworks are in place to ensure that other sectors of the economy – Environment, Wildlife, Agriculture, Tourism, Manufacturing, Education etc, benefit from the emerging Oil and Gas sector.
Self-regulation - Uphold high standards of integrity to ensure genuine partnerships with Government and the people than can bring about positive change to create a better society
The National Oil and Gas Policy which is the key guiding document for development of Uganda’s oil and gas sector recognises environment protection as one of the key principles.
THANK YOU.
WELCOME TO THE 7TH EAST AFRICAN
PETROLEUM CONFERENCE AND EXHIBITION
(EAPCE)
4th to 6th MARCH 2015
KIGALI, RWANDA
www.eapce15.eac.int For Further information:
Permanent Secretary, Ministry of Energy and Mineral Development
Email: [email protected]
[email protected]/ [email protected]
www.petroleum.go.ug