Petroleum Authority Executive Director, Earnest Rubondo said the first five years have been characterized by building the institution while on the same time regulating the country’s oil and gas assets.
PAU Executive Director , Earnest Rubondo says meeting the public expectations of oil and gas finds and alligning the government priorities with those those oil companies have been some of the biggest challenges over the five years Credit Wambi Michael
establish a prudent accounting system if the oil and gas resources are to benefit
the country and its citizens. The call for transparency and accountability comes
as the Petroleum Authority of Uganda commemorates five years.
held virtually on Thursday under the Theme "Creating Lasting Value PAU at Five” had speakers from Ghana and Norway who emphasized the need to equally safeguard the
data that has so far been obtained during geological surveys and exploration stages.
Most of Uganda oil and gas laws and policies have been drawn from the Ghanaian and Norwegian experiences.
General of the Norwegian Petroleum Directorate, Ingrid Solvberg speaking from Norway
praised Uganda for putting in place the required laws and regulations of the
oil and gas sector. She however
noted that the task of the Petroleum Authority is to ensure that such institutions
"The Petroleum Authority
of Uganda marks five years. And that means you are no longer a newcomer. Today
my main message to you is the stress the importance of the authority. Such
institutions should play a major role in developing national resources. Now we see the importance of building national
capacity” said Solvberg.
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development, Chief Executive Petroleum Commission of Ghana, Egbert Isaac Faibille,
Uganda should adopt policies which will maximize the benefits of the oil and
gas for current and future generations. He said one
of the ways of achieving those aspirations is through using local expertise,
goods and services and job creation for the citizenry.
been in oil production for ten years since the discovery of oil and gas resources
in commercial quantities in 2007. The Ghanaian
Oil Commission Chief urged the Petroleum Authority to prepare and manage the expectations
that comes with the discovery of oil and gas.
Those expectations, according to
Faibille can only be met by the implementation of local content policies for job creation
and general prosperity. Develop local
capacity or capabilities in all aspect of the oil and gas sector value chain through
education, skills and expertise development, transfer of technical know-how.
He says since
petroleum exploration are quite costly, Uganda should put in place budgetary
and cost control measures so that petroleum revenues are not eroded by costs
which may not be necessarily be considered as allowable petroleum costs.
“As new Petroleum
producer, the Petroleum Authority of Uganda should ensure and consider cost added
as a very important function” said Egbert Isaac Faibille.
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He said from
Ghana’s experience, the best way to create a stable environment for investment
deal with the oil companies and other stakeholders in a transparent and a
legally sound manner consistent with international best practices.
“As regulators, you must enforce the laws in a
fair and nondiscriminatory manner.” Cautioned Faibille The office of
the Auditor General in Uganda disallowed over 250 billion Shillings (USD 70 million) claims
by some of the licensed oil companies in Uganda.
The funds had been claimed as
recoverable costs in oil exploration and drilling.
The rejected costs had
been inflated by the companies to claim more money from the government
when oil production begins. Petroleum Authority Executive Director, Earnest Rubondo said the first
five years have been characterized by
building the institution while at the same time regulating the country’s oil
and gas assets.
with his Ghanaian colleague that the challenge of meeting society’s increased
the expectation of the benefits from the oil and gas sector has been enormous.
a challenge to manage but we are still going about it through engagement with
the public” said Rubondo.
“The second challenge is the alignment of the
country’s interest and those of the licensed oil companies. This has been a challenge
for quite some. It leads to a delay in the implementation of the project. There are
times when the country’s interests cannot align with the licensed company’s interest
and require a lot of time to align them” he explained
Milestones and Challenges.
challenges aside, Rubondo said through the years of existence the authority has put in place laws and regulations to guide the future of the
He says the establishment
of the National Suppliers register on which over one seven hundred companies
have qualified and registered as potential supplier’s to the oil and gas
sectors. He says only 517 companies had been registered and qualified by the time
it was launched in 2017.
Rubondo, between 60-70 per cent of the companies registered and qualified on the
register is owned by Ugandans.
also has a national talents register. The talents register supports the monitoring
the human resource capacity and technical skills from the oil and gas sector
which are available in the country.
talent’s register which has been in place since last year has so far over two thousand
eight hundred individuals with skills required for the oil and gas sector.
register also comprises the companies that are looking for human capacity to
employ. The Authority says so one
hundred and eight companies have been registered as potential employers once
activities in the gas sector resume.
Rubondo says his
Authority is working with and ministries, departments and agencies to create
linkages that could earn the country more revenue from oil and gas.
estimated that Uganda could earn up to twelve billion US dollars during 4-5
years during development.
“And this stage
is crucial because most people think that the benefit from the oil and gas
sector will begin the country produces oil and the revenue comes to the treasury.
The key sectors that the Authority has begun to work with may start issuing
these linkages. “he said
identified the Petroleum Authority include, the health, agriculture and land
use planning among others. It was
expected that the licensed companies should have taken a Final Investment
Decision (FID) by the first quarter of this year.