The Cabinet has finally given green light to the Energy Ministry to grant exploration licenses and sign production-sharing agreements (PSA) for two oil exploration blocks in the Albertine Graben.
According to the Minister of state for National Guidance, Godfrey Kabbyanga, a cabinet meeting held on Monday this week approved two oil companies following successful negotiations.
Kabbyanga says that the approved oil firms include DGR Energy Turaco Uganda SMC Limited which is a unit of Australia’s DGR Global and state-owned Uganda National Oil Company (UNOC).
DGR, which owns another exploration license in areas of Kanywataba, will be operating from Turaco block which is a 637-square kilometre exploration area located in Albertine Graben near the border with Congo in Ntoroko district.
Heritage Oil- a British company had done some exploration in the area but abandoned it in 2004. The block reverted to the government as per the laws.
On the other hand, UNOC will be undertaking operations in Kasuruban exploration area that stretches over 1,285 square kilometres stretching between Buliisa and Packwach districts. This license was previously held by Tullow which made some discoveries. Tullow did not however go further with more drilling. The Anglo-Irish firm relinquished the block to the government. It is alleged that Tullow may have abandoned the block on discovering that the amount of crude  there would not be commercially viable.
The two exploration areas given out are part of five blocks the government auctioned in the second licensing round launched in 2019. The three which have not been given out are; Avivi (1026km2), Omuka (750km2) and Ngaji (1230km2).
Frank Mugisha, the Ministry of Energy assistant commissioner and licensing manager for upstream petroleum management says the two firms will initially get two-year exploration licenses for the blocks.
