Spotlight: Government pledges transparency in compensation of persons affected by oil projects

The Petroleum Authority of Uganda (PAU) has pledged to be transparent while undertaking compensation of project-affected persons in the construction of the crude oil pipeline.

The authority, which is tasked with the oversight role of the entire oil exploration project, said that preliminary stages of evaluation has already begun.

The remarks were made during NBS TV's Spotlight where different oil experts discussed Uganda's oil and gas sector, achievements, next steps and opportunities.

The permanent secretary in the Ministry of Energy and Mineral Development, Robert Kasande said the land compensation processes for all the projects are being expedited to ensure that all the Project Affected Persons (PAPs) are compensated.

At least 5523 people will be compensated during the development of the Tilenga project and 727 for the Kingfisher development.

According to the experts, an assessment has also been made of the environment issues that may arise with oil and gas activities in Uganda.

They said the national oil spill contingency plan, which is spearheaded by the office of the Prime Minister, has established a coordination mechanism for preparedness and a response for any eventualities.

Experts urged the Uganda National Oil Company (UNOC) to entrench itself in the oil industry if Uganda is to earn a significant amount of petroleum revenue.

Uganda is expected to earn up to $3 billion (approximately Shs 7 trillion) in revenues from exports of up to 60,000 barrels of oil per day with UNOC's stake.

Proscovia Nabbanja, the chief executive officer, UNOC said the refinery will be producing five product lines; diesel, petrol, aviation fuel, liquified petroleum gas, and heavy fuel oil.

"Within the Kabaale Industrial Park, we shall have the crude oil export pipeline hub, the Uganda refinery, mixed (Light / Medium) industries, warehousing and logistics, and Uganda’s 2nd international airport which is at about 55% on schedule,"said Nabbanja.

She explained that Vision 2040 is focussed on industrialisation and they believe the Kabaale Industrial Park project is one of the key projects that will show that the oil and gas sector can propel industrialisation.

"For every dollar invested within the course of the projects, we will be able to return 10 dollars,"she noted adding that "the returns for each of the projects sit anywhere between 15 to 24%. This only shows that as a business, we must invest in these projects," she said.

She stated that they have two subsidiaries, the National Pipeline Company which manages the pipeline and storage terminals, and the Uganda Refinery Holding Company which manages the refinery and its attendant infrastructure such as the refined product pipeline.

PAU is implementing a $ 500,000 capacity building project funded by the African Development Bank to enhance the capacity of Micro, Small and Medium Enterprises along the East African Crude Oil Pipeline

The executive director of the Petroleum Authority of Uganda, Ernest Rubondo said said effective communication of the developments in the sector is a critical success factor for increasing transparency in the oil and gas industry.

The 2018 National Content Policy among other legislative frameworks enforces succession plans involving expatriates to ensure that Ugandans can take up the available jobs once foreigners leave.

A baseline survey was done to establish the number and nature of jobs expected within Uganda's oil and gas sector and revealed that 160000 direct and 45,000 indirect jobs shall be created.

Rubondo noted that government has done quite a number of things to support Ugandans to participate in the oil and gas sector.