Uganda Ministry of Energy and Mineral Development says it will make a final investment decision, FID, for its crude oil refinery next month, a crucial step towards commercially producing crude oil by 2025.
Uganda discovered crude reserves in the Albertine Rift Basin in the west of the country more than 10 years ago and reserves are estimated at 6.5 billion barrels.
“Negotiations with the refinery consortium on the various agreements are ongoing and the FID is expected in June 2023,” the ministry said in a report on Friday.
The consortium that includes a subsidiary of U.S. conglomerate General Electric Co (GE.N), is planning to build and operate a 60,000 barrel per day refinery in the east African nation at a projected cost of about $4 billion.
The oil fields are jointly owned by France’s TotalEnergies (TTEF.PA), China’s CNOOC (0883.HK) and the Uganda National Oil Company (UNOC).
“Commercial drilling for oil production at the Tilenga project in the Lake Albert basin will also start next month,” it said.
Meanwhile, the ministry said data from ongoing exploration activity in the Moroto-Kadam Basin in Karamoja Region in Uganda’s northeast also showed the area had petroleum potential.
“Analysis of this data… is ongoing. One oil seep has so far been identified in the basin giving an indication of a petroleum system in the area,” it added.
A new hydrocarbon-rich area would help add to country’s petroleum resources and potentially boost the viability of the refinery and a crude export pipeline under development.