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Oil Find In Uganda Cause For Hope, Caution

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Oil Find In Uganda Cause For Hope, Caution


Oil Find In Uganda Cause For Hope, Caution

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Uganda is sitting on a whole lot of oil. Experts say there's enough oil around Lake Albert to make that country a top producer in Africa. If all goes well, Uganda will begin commercial production in the next year or two, but a lot can happen between striking oil and striking it rich. NPR's Gwen Thompkins was recently in oil country, and sent this report.

(Soundbite of laughter)

GWEN THOMPKINS: There's a joke in Uganda that makes people laugh every time they hear it. This is the one about how British colonials first laid claim to the land that is now called Uganda. It was the late 1800s, and as the Ugandans tell the story, the land grab happened faster than you can say amen.

Here's Jane Nyendwoha and her colleague, Ken Opitto.

Ms. JANE NYENDWOHA: When the white man came, he came with a Bible, eh? And they told us to close our eyes. So by the time they opened, their land was gone.

(Soundbite of laughter)

THOMPKINS: Wait, they came with a Bible?

Ms. NYENDWOHA: Yeah, and to told them close, and we'll pray.

(Soundbite of laughter)

Mr. KENNETH OPITTO: And they close their eyes, and the land went.

Ms. NYENDWOHA: They told them to shut their eyes.

(Soundbite of laughter)

THOMPKINS: That joke is so old, it has whiskers on it. But these days, it has new resonance here in the Lake Albert region. This is where Uganda's oil is. And the people at the lake are hoping they won't get swindled. As Nyendwoha likes to say, this time, our eyes are open.

Jane Nyendwoha and Ken Opitto work for Tullow Oil, a London-based company that has a contract with the government of Uganda to explore the area.

Another company called Heritage Oil also has a contract to explore. But few Ugandans outside the president's inner circle know the details of these contracts. So there's a feeling of cautious optimism in the wide-open west, where pale, green cliffs rise over the great, silvery lake.

Kubalirwa Nkuba is a county leader here. He says Ugandans want the oil companies to do right by them.

Mr. KUBALIRWA NKUBA (County Leader, Lake Albert, Uganda): They must have an agreement with government on how they're going to operate and what would be the benefits.

THOMPKINS: But you've not see this. You've not seen an agreement.

Mr. NKUBA: No, no. Not as yet.

(Soundbite of music)

Unidentified Woman: (Singing) I can give you more. You never need (unintelligible).

THOMPKINS: Nkuba's office is in a rickety storefront town called Buliisa, where a gathering of idle men sits across from the Tullow office, listening to country-and-western music.

(Soundbite of music)

Unidentified Woman: (Singing) Well, I can give you more. You never need...

THOMPKINS: With recent oil exploration, Nkuba says life has gotten a whole lot better. Ten years ago, if someone in Buliisa wanted to make a telephone call, they'd have to walk to the next town. Now, there's cell phone service. There are roads and vehicles. Tullow Oil has brought boreholes, HIV testing and educational advantages to the area. And if you're in the fishing business - or cattle-raising or farming - there's a chance to make money now. Oil explorers have to eat, too, you know.

Mr. NKUBA: Fish, milk, eggs, meat, sugar, cooking oil. What can be got here, the locals are supplying.

THOMPKINS: Nkuba is pleased with his prospects, both material and political. In what many outsiders might view as a conflict of interest, he already has contracts with Tullow to supply beef and fish to the company's camp on the outskirts of town.

Plus, he's got job security as a politician. To cut down on tribal feuding here, Uganda's president has proposed a plan that favors the indigenous people of the area above all others for political office. The president calls it ring fencing, and ring fencing means that Nkuba's people, known as the Bagungu, have a lock on local politics for the foreseeable future. Nkuba says it's only right.

Mr. NKUBA: I know more problems about Bagungu because I'm a Bagungu myself, and therefore can handle the Bagungu much better than anybody.

THOMPKINS: But political ring-fencing isn't democratic, and Uganda's president, insists he is running a democracy here, despite international worries over rampant corruption, human rights abuses and a lack of transparency in the oil business.

Uganda's energy minister is not returning phone calls. And many in parliament say they don't want Uganda to end up like Nigeria, where oil benefits only a few individuals.

Tamale Mirundi is the president's spokesman. He says Ugandans know all they need to know about oil in the country, and when the president has more to add on the subject, he will.

Mr. TAMALE MIRUNDI (Spokesman for Uganda's President): The president is not hiding anything. The opposition are trying to use oil to incite our people. You cannot hide it.

THOMPKINS: And yet everyone's hoping that the treasure underground will more than make up for the irregularities between people on the surface.

Capped oil wells like this one pock the fresh, green landscape like little patches of dry skin. Much of the lake area is national park, but that hasn't stopped oil exploration. The sound of generators pumping water from well to well is as common as birdsong.

Tullow says Uganda could be sitting on two billion barrels of oil. The bad news is that the oil is as waxy and viscous as shoe polish in a can. It will be expensive to maintain a continuous flow. But there's good news, too. Kenneth Opitto manages Tullow's field operations here. He's opening the cap on a well called Kasamene-1.

(Soundbite of banging sound)

Mr. OPITTO: This is 700 meters. All these wells around this area are very shallow. It is cheaper to get there because of the amount of equipment that you use, the length of time you spend here. This normally takes us two weeks to drill and get to total depth.

THOMPKINS: Right now, nothing much is going on, which is why some sleepy frogs have clustered near the drill hole. Tullow says commercial production will begin sometime next year. And then comes the tricky part: Uganda is landlocked. A pipeline will cost a fortune to build, and so far, neither Tullow nor Heritage Oil has the money.

Uganda's president also wants a refinery. Heritage Oil has announced plans to leave Uganda. And as Heritage exits, Tullow is hoping to attract a bigger partner to help pay the bills - maybe the French or the Chinese.

But these days, the only overtures coming into Tullow's offices are from locals who need jobs. Shera Abdulrahmin Juma is desperate.

Mr. SHERA ABDULRAHMIN JUMA: I have no job, but I'm moving up and down, searching for my people at home to eat. That is my problem.

THOMPKINS: Juma is skinning the leg of a goat under a tree and preparing it for the grill. That goat leg, with fur still tightly hugging the ankle, will feed some of those idle men sitting across from the Tullow office. But Juma has a family of eight to feed.

Mr. JUMA: If there's any opportunity from Tullow, let them give me job so that we can maintain. Any job they give me, I will be working on it.

THOMPKINS: Most people here know that they'll never get rich from oil. But oil could make them less poor than they are now. And for many, that would be enough.

Gwen Thompkins, NPR News.

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