In a significant development for Uganda’s energy sector, China National Offshore Oil Corporation (CNOOC) Uganda Limited has been granted a license for the construction of a Liquefied Petroleum Gas (LPG) facility as part of the Central Processing Facility.
The announcement comes after a thorough review of the license application by technical teams from the Ministry and other relevant government agencies.
Expressing congratulations to CNOOC Uganda Limited, Minister of Energy and Mineral Development Ruth Nankabirwa commended the collaborative efforts between the government and the company, stating, “I wish to congratulate CNOOC Uganda Limited on attainment of this license, which paves the way for the commencement of the construction of the LPG facility that is a critical part of the Central Processing Facility.”
The license is based on a mutual understanding of the strategy for utilizing excess gas from Uganda’s oil fields. With an estimated 500 billion cubic feet of gas alongside crude oil resources, the government and CNOOC have committed to not flaring or venting the gas, in adherence to Uganda’s laws and best industry practices.
The primary purpose of the gas will be to meet the energy needs of upstream projects, with any excess gas being converted into Liquefied Petroleum Gas. This approach aligns with regulatory frameworks and industry best practices, ensuring minimal environmental impact.
Minister Nankabirwa also commended CNOOC’s commitment to compliance with Ugandan laws, stating, “I commend CNOOC for the commitment to comply with the laws of Uganda.”
During the operational phase, the company is expected to produce over 20,000 tons of LPG per year at peak capacity from the Kingfisher Development Area facility. This production aligns with Uganda’s national development objectives, particularly in transitioning from biomass dependence to cleaner fuels.
The project is seen as strategically important for the country beyond economic gains, aiming to stimulate increased consumption of LPG through market penetration interventions. Nankabirwa assured CNOOC Uganda Limited of constant support, emphasizing the project’s broader significance for national development.
In conclusion, the minister stated, “We expect that CNOOC will carry on with the spirit of cooperation that has been demonstrated so far and adhere to all other relevant provisions in the laws as a licensee, as well as the conditions with which this license has been granted.”
The successful collaboration between the government and CNOOC Uganda Limited marks a milestone in Uganda’s efforts to utilize its natural resources efficiently and transition towards cleaner energy solutions.
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