At first I never had interest in oil issues but since the day I decided to go to Hoima and see the progress in the Albertine region, I believed the oil issue was very serious because of the developments that were ongoing in the region. So for all this time I have been following up on kinds of literature about oil.
Last week, I happened to read some funny dossier by someone in the names of Hussein Lumumba Amin and in his wisdom he was trying to say that Ugandans shouldn’t expect much from oil production that everyone has been waiting for since discovery. In his submission and his mathematics, figures were not adding up which is okay because he is not an expert in oil or even an expert in auditing but the issue here is that the calculations he had in his submission were very wrong.
His calculations aside, he said that Ugandans are not and will not benefit from the oil and when I read this yet I see very many beneficiaries already, I had to first laugh abit and then realized that this gentleman is just a fun of literature and his interest is commenting on issues for relevance purposes.
I read some piece that was written by the legal director of the Petroleum Authority Ali Sekatawa in response to the scattered mathematics but after a few days I again saw Mr. Hussein Lumumba fuming and calling the Petroleum Authority all kinds of names and of course throwing insults at the person who responded to him.
Learning is a process and I expected elder Hussein to learn from the experts but for purposes of educating my senior elder Lumumba, let me say this.
First of all, it is important to note that Uganda is going to develop an oil refinery in Kabaale, Hoima district as one of the two means of commercializing the discovered oil resources.
Secondly, it should also be noted that the product slate of an oil refinery is typically a function of several factors including the type of crude oil being refined and the configuration of the refinery in question.
Therefore, without reference to a specific refinery configuration and type of crude oil, your numbers would largely be theoretical and not project specific. For example, referring to the type of crude oil, you may also want to know that Uganda’s crude oil is sweet (meaning it is low in Sulphur) and it is therefore not possible to get the amount of Sulphur product that you quote for a barrel of crude oil.
That aside, it is also not possible that you can extract more quantity of products (168 liters) than the actual input volume (159litres) of crude oil. This further shows that you analysis has no sound basis. Therefore, without the above issue of product slate being properly addressed, you are not in position to definitively determine the exact value that would be derived from products expected from a particular refinery that is processing a particular type of crude oil.
One would challenge you to provide a specific breakdown for each product and price detailing how you arrive at the value of $650 per barrel, providing all the necessary price references and price buildup provided. These numbers typically come out of a careful analysis taking into consideration all necessary pricing factors, using the known industry pricing methodologies/mechanisms. It is therefore not enough to just quote a figure and claim that that is the value one would derive from an already inaccurate product slate (list of products).
It is also inaccurate and misleading to claim that Sulphur is more valuable than the other produced white products (gasoline, diesel, LPG, jet fuel), fetching you $500 per kilogram. If that were the case, the market would be awash with businesses trading in Sulphur, instead it is trade in other products that is seemingly lucrative.
This further raises concerns with your data sources since you have not quoted any price references. Again, you may want to interest yourself in how prices of the different products are determined, including the different pricing mechanisms used.
Of course am not here to educate you about data analysis and computation of figures but just strictly schooling you on how to make research (LISAAKI). All my time I have always seen my boss at office reading a lot just for purposes of having proper figures and having clear information and I think it’s the reason I also have a lot of interest in researching and this should go to everyone, in case you have interest in a particular topic, just make enough research before writing about it because once you throw wrong information on social media in this era of noise making, then very many Ugandans will be confused by the un-researched thesis.
Finally, for those Ugandans who have already enjoyed the fruits from the discovery of oil and those who are expecting to benefit from the many projects in the Albertine region, lets embrace the operations in the region and support all the firms on ground making sure that we enjoy the fruits from our oil.
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