Govt fails to find market for Crude Oil

crude oil

courtesy photo

The Government has failed to find buyers for over 40,000 barrels of crude oil extracted from Uganda’s oil wells in Bulisa and Kikube districts.

While some Ugandans have alleged that the government has airlifted some of the crude oil, it is emerging that all the test crude remains confined in containers because there are no buyers.

The government has since 2015 been trying to get buyers for the crude oil which should be used for industrial processes.  

The Directorate of Petroleum Director at the Energy Ministry, Homey Malinga says no buyers have expressed interest in Uganda’s black gold.

“That test crude has been there. But the amount of that crude can’t enable somebody or a company to establish a system that will take it. We tried to sell it to Hima, they said they will need to configure their system for cement production” said Malinga

Hima Cement part of has been emphasizing on the need to use renewable energy sources like biomass to power its cement production.  

Malinga reveals that the attempt to sell the crude to companies that generate power has also not been successful. “So our hope is that if we don’t sell it now, maybe in future when the refinery is there, it will be sued for blending. We blend it with fresh crude” said Malinga

Crude oil has been used in tarmacking roads. With a number of road being constructed in the Albertine region and generally in the country, it was hoped that construction of roads that they would use the stored crude.

But Malinga says the stored quantity may now be enough even for one road.  “Because if you are to supply 40,000 barrels is not too much. But we tried many options including disposing of it. And even disposing it off you have to go through a tedious process” he said.

The oil is now stored in specialised containers or called Butitainers at four locations in the Albertine Graben; Kasamene-1, Ngara-1 and Ngiri-2 well sites in Buliisa District, and Tangi Camp in Nwoya District.

The oil in question was extracted by companies like Tullow to appraise the discovery to determine the extent of the discovery and the characteristics of the crude oil.

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