Uganda sued over oil deals disclosure

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A Ugandan pressure group has sued the government to compel it to disclose details of Production Sharing Agreements (PSAs) it signed with four exploration companies, the organization’s lawyer told Reuters.

Uganda said last month it will demand tougher terms in the next round of PSA negotiations with foreign exploration firms eyeing its Lake Albert reserves.

However, advocacy group Greenwatch filed a case at the High Court on December 22 seeking to have the government release copies of PSAs signed with Britain’s Heritage Oil and Tullow Oil, Dominion Oil and Neptune Petroleum.
“According to our constitution, every citizen is entitled to information within the possession of the state and it can only be legally withheld where disclosure jeopardizes national security or compromises individual privacy,” said Kenneth Kakuru, Greenwatch’s lawyer.
“So the state is acting illegally in refusing to release the PSAs.”

The east African nation discovered oil deposits in its Lake Albert region in February 2006 and total reserves are estimated at about two billion barrels.

In November Heritage announced it had signed a binding letter of intent to sell Italy’s Eni two large exploration blocks, raising the Italian firm’s stake in Uganda’s oil sector, which could have the potential to transform its economy.

The Ugandan government has defied pressure to disclose the terms of its agreements with oil companies, arguing that disclosure would severely weaken its negotiating position in future licensing rounds.

Licensing of new exploration blocks is expected to start in third quarter of 2010 after a two-year suspension.

London-based Platform, a social justice and environmental advocacy organisation, published a report in November that said exploration companies would get a disproportionate share of the oil proceeds.

Foreign oil explorers were set to reap between 31-35% return on investments based on medium-price oil outlook, leaving Uganda worse off in real cash terms, Platform said.



Kakuru said the government’s stand that disclosure would weaken its position in future negotiations was not backed by any law as a basis for withholding public information.