Uganda says it will issue new oil exploration licenses next fiscal year

KAMPALA, Sept 11 (Askume) – Uganda will encourage new oil and gas exploration in the 2025/2026 financial year (July-June) to boost investment in the sector and overall economic growth, the finance minister said on Wednesday. license.

The last round of licensing in the East African country began in 2019 and ended early last year . It handed out the last two of the five proposed blocks.

“Accelerating investments in oil and gas will help fuel Uganda’s rapid growth in the next financial year,” Matia Kasia said in a speech outlining the country’s priorities for the 2025/2026 financial year.

He said the government will issue additional exploration licences to boost production to achieve greater investment and overall growth in the oil industry.

Uganda plans to begin commercial oil production from existing fields in the Albertine Graben basin in the west of the country next year.

The government says only 40% of the graben has been explored so far, with an estimated 6.5 billion barrels of oil yet to be discovered.

France’s Total Energies (TTEF.PA), with a 56.7% stake, is the field’s main owner, along with other partners including China’s CNOOC (0883.HK) and state-owned Uganda National Oil Company UNOC.

Kaseja also said Uganda’s debt burden remains “unsustainable” despite the downgrade by the rating agency. He said the country remains committed to keeping its debt-to-GDP ratio below 50%.

In late August, Fitch downgraded Uganda’s rating to B from B+, citing “low access to concessional financing, high domestic borrowing costs and declining foreign exchange reserves”.

Fitch’s move comes after Moody’s downgraded Uganda’s rating to B3 from B2 in May, citing the country’s “deterioration in debt affordability”.