Saturday, May 18, 2024
Home > Featured > How Uganda Risks Losing Trillions To Oil Companies
FeaturedNewsOil & Gas

How Uganda Risks Losing Trillions To Oil Companies

Uganda risks losing trillions of shillings in recoverable costs to oil companies, says Parliament’s Public Accounts Committee (PAC).

This is a result of Ministry of Energy and Mineral Development’s failure to demand oil reports from the oil companies.

The committee members while meeting the officials from Energy Ministry led by the Permanent Secretary, Robert Kasande on Wednesday discovered that oil companies did not submit oil reports as required by law for three years to the ministry for evaluation of the oil sector. The Committee was chaired by Soroti District Woman MP, Angelina Osege

This leaves unanswered questions on whether there is more oil discovered for the country’s benefit.

The law requires that oil companies operating in the country generate their oil activity repots and submit it to the Energy Ministry for every six months but have undermined this requirement.

The Committee says Energy Ministry has  for three years of 2013/14, 2014/15  and 2015/16  not received reports from international oil companies, causing worry to lawmakers  that this would enable oil companies gain more money through this loophole when it comes to considering their recoverable costs.

MPs discovered that Tullow Oil Uganda used exploration Area II for two years without giving its activity report to the Ministry Of Energy.

The chairperson of the committee Osege said that there could be some officials in the Ministry of Energy benefiting in the non-submission of oil reports to the ministry by the oil companies.

The permanent secretary in the ministry of energy Kasande blamed the non-submission of oil reports by oil companies to the transition from Oil Company to another.

It should be noted that last year, the auditor general rejected $70 million in claims by the international oil companies as recoverable costs incurred during oil explorations and drilling activities in the Albertine Graben region.

The rejected costs according to the auditor general’s office had been inflated by the companies in order to claim more money from government when oil production eventually begins later in 2020 or thereabouts.


Leave a Reply

Your email address will not be published. Required fields are marked *