Mr Ernest Rubondo, the executive director of PAU, speaks to journalists in Kampala on Tuesday.

At least 40% of contracts in the oil and gas sector, an equivalent of $1.2b (about Shs4.2 trillion), will be awarded to Ugandan companies in this year, the sector regulator has announced.

According to the Petroleum Authority of Uganda (PAU), at least $3m (about Shs10.5 trillion) will be invested in the oil and gas sector in 2022, the Government has said.

Mr Ernest Rubondo, the executive director of PAU, told journalists in Kampala on Tuesday that the investment will contribute to the national Gross Domestic Product (GDP).

The investments will be for the key flagship projects of both the Tilenga and Kingfisher oil development projects, as well as the early works of the East African Crude Oil Pipeline (EACOP).

The Kingfisher project involves a planned Central Processing Facility (CPF) with a capacity of 40,000 barrels of oil per day and 31 wells (11 injectors and 20 producers) to be drilled on four well pads. The Tilenga project forms part of the wider oil and gas development in the country.

It involves the development of six oil fields in Buffisa and Nwoya districts in the Albertine Graben by Total E&P Uganda.

A total of 400 wells will be drilled from 34 well pad locations and a network of buried pipelines will collect the oil produced from each well pad.

At the moment, contracts under the Tilenga oil development project have been awarded, and they are currently preparing ground for the industrial area, which will host the Central Processing Facility. The Kingfisher, on the other hand, has awarded some of the works and the contractor is currently preparing to start the clearing and setting up of the facility.

PAU boss Ernest Rubondo emphasised the need to register on the National Suppliers’ Database (NSD) as one of the conditions for one to participate. The NSD is an online platform for regulating the procurement of goods and services in the oil and gas sector and is updated annually. The NSD was intended to provide an opportunity for a transparent and standardised supply chain for the oil and gas sector, which will in turn lead to increased competition and efficiency. However, PAU says, being on the NSD does not mean automatic award of a contract, adding that entities have to compete. The infrastructure was set up in 2017.

An oil exploration facility in Bunyoro.

According to the 2021 report, which was released on Tuesday, a total of 2,662 companies, both local and foreign, have been qualified and registered by the PAU on the NSD. The numbers have increased from 513 in 2017. Of the total number, Rubondo says, 1,966 entities currently registered on the NSD are Ugandan, whereas as 696 are foreign, up from 48 in 2017. “We have attracted companies from America, Europe and Asia, as well as Africa. This shows how the oil development project in Uganda is worth investing in,” he said.

“The Authority welcomes entities to register on the NSD to be able to provide goods and services to the country’s oil and gas sector. Application and registration on NSD are done online on a 24/7 basis. All entities on the NSD are required to confirm their interest to remain on the register after three years,” he said.