It’s an oil rush… if you’re a big multinational oil company

This month, Uganda, or at least the 3% of the population that reads newspapers, has been agog with news of the impending sale of Heritage Oil’s Uganda stake to Eni, the Italian para-statal petro-giant. The sale heralds the end of exploration by heritage, a primarily upstream oil company, and signals the shift to big-league oil processing. A shift that could see Uganda become one of the top 50 oil producing nations in the world.

But, as I as a foreigner am often admonished by locals: “This is Ugaaandaaa!”. Thanks, I noticed that for the last 2 years I’ve been here. However, the sheer murkiness surrounding the exploration and potential exploitation of this fair country’s hydrocarbons has generated more heat than will possibly be generated when actual crude starts flowing out of the ground, and the streets of its villages course not with milk, but with oil.

I’ve been studying and writing about Uganda’s oil exploits for a few months now. What I’ve seen with my eyes makes me quite hopeful about what the country could achieve if the crude is well managed. Most others, particularly the virulent and generally misinformed NGO lobby, think the country is on the path to the Niger Delta. In between, the oil MNCs are likely to have a great time, playing-off the expectations of citizens on one hand, against the ponderous bureaucracy of government, and minting bucks in the meanwhile.

There is no doubt, indeed, that oil players are here to make money for their shareholders. That is the law of business. Whether Heritage, and its fellow Uganda oil explorers – Neptune, Dominion and big-brother Tullow care for the environment (somewhat), indulge in occasional CSR projects (sometimes), and be transparent about their public information (somehow), it remains that they are here to find oil, guage its viability, present the right working policies to government, then with approval of the government, find and sell their licenses to the oil majors: Shell, Eni, Total, ExxonMobil, OilLibya, the Chinese, the Iranians, Reliance, or what have you.

Problem is, no one seems to know the fullness of the picture. The state-backed New Vision has now run two Saturday edition front-page headlines on oil. Both appeared suspect, one linking Libyan dealings to the oil outcomes, the other, in praise of Tullow. The Tullow boss, Aiden Heavy proclaimed (in the published interview) that Uganda will get 80% of oil revenues for every barrel. The paper, astonishingly, did not bother to ask how this is to be achieved but swallowed it whole. This is Ugandaaa.

Drill, baby, drill

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