Tanzania’s President John Pombe Magufuli wants investors, the governments of Uganda and Tanzania to expedite the construction of the East African Crude Oil Pipeline (EACOP). Magufuli argues that the pipeline should be constructed in the shortest time possible instead of waiting until 2020 to realize first oil.
Government of Uganda expects to start oil production by 2020 after construction of key infrastructures like the pipeline and the refinery. However, Magufuli believes that first oil can be fast tracked.
“Let us move forward. Why should we wait until 2020? The investors are here, we have the money, and we have the experts. Investors know in case we start now, they will get the results immediately, so, why should we wait results until 2020. We need this project now,” he said emphatically.
Construction of 1,445 km crude oil pipeline is scheduled to be completed by 2020. The pipeline project, spearheaded by Total E & P, one of the joint venture oil partners is expected to cost $3.55 billion. Magufuli who is on a three state visit to Uganda was speaking at Mutukula in Kyotera district on Thursday, after laying a cross-border mark-stone for the East African Crude Oil Pipeline (EACOP). He is also expected to lay a mark stone for the EACOP in Kabaale, Hoima on Saturday. “We are ready for the project, we shall be ready, today, tomorrow and we shall always be ready for the project,” Mugufuli explained.
At the same function, the two Presidents also recognized a team of scientists that spearheaded exploration activities leading to the discovery of oil and gas resources. Uganda’s Minister of Energy and Mineral Development Irene Muloni said EACOP will support economic growth in the region.
“As government, we encourage investors to continue supporting national content in the region which is a key factor in our socioeconomic development. We shall put in place the necessary policies, laws and regulations to ensure that our people are trained, acquire employment and entrepreneurship is boosted,” Eng Muloni said.
Government of Uganda will participate in the East African Crude Oil Pipeline (EACOP) project through Uganda National Oil Company (UNOC). “Not only will the project spur infrastructure development for both countries including road network at a port at Tanga, it will also facilitate and boost trade in the region,” Muloni added.
She said that building the pipeline from Kabaale to Tanga is premised on being the least cost, least risky route. The 1,445 kilometer heated pipeline is poised to become the longest heated crude oil pipeline in the world. It will provide access to Uganda’s crude oil to the international market. In August this year, the two leaders laid the first foundation stone in Tanga for the East African Crude Oil Pipeline.
He describes artisanal miners as “a menace” to the mining sector
In a new twist that arguably contradicts government rhetoric on Artisanal and Small Scale Miners (ASMs) in the country, the Director, Directorate of Geological Survey and Mines (DGSM) in the Ministry of Energy and Mineral Development, Edwards Kato, has ordered all illegal artisanal miners to vacate the respective mines.
“Those people [artisanal miners], still joking should style up. Now, I’m not only a director [in the ministry] but also a commander of the Minerals Protection Unit of the Uganda Police Force. So, those illegal artisanal miners still behaving like those in Mubende [who were evicted], they should pack and vacate the mines, otherwise, my police force will them help to pack,” Mr Kato said.
With the Mineral Police, he emphasized the “madness” of artisanal miners will stop. Kato praised the “Chunga Mazingira Operation”, sanctioned by President Yoweri Museveni in which more than 60,000 artisanal gold miners in Bukuya and Kitumbi sub counties in Mubende district were evicted to pave way for an investor to develop the mines.
The eviction left many artisanal gold miners counting loses without any source of livelihood. The artisanal miners have since sued Attorney General [Government] seeking compensation for their property destroyed during the brutal eviction jointly carried out by the army and police.
On August 7th, this year, the Inspector General of Police (IGP), created a unit known as Mineral’s Protection Police, within the police force. Headed by Ms. Keigomba Jesca, the Unit is charged with implementing policies, plans and strategies for effective security of minerals in the country. The unit was formed days after the army and police evicted artisanal miners in Mubende district. Minerals have a direct impact on revenue, immigration, law and order as well as environmental management.
“Artisanal miners have been a big thorn in the mineral’s sector. They are a total menace,” Mr Kato said.
Kato was on Wednesday 4th, October this year speaking at the 6thAnnual Mineral Wealth Conference at Kampala Serena Hotel. Running under the theme “Minerals: Knocking on the door to cause economic transformation in Uganda,” the conference is organized by the Uganda Chamber of Mines and Petroleum in collaboration with the Ministry of Energy and Minerals Development.
According to a report titled, “Understanding Artisanal and Small Scale Mining (ASM) Operations in Uganda,” by African Center for Energy Policy (ACEMP), 2016, there are more than 250,000 Artisanal and Small Scale Miners in Uganda. Eviction of these miners will exacerbate unemployment and impoverishment, especially among the youth and women who work in the mines.
Though most artisanal miners do their work without any license, which is illegal, evicting them from the mines is not a solution. They instead need to be helped to formalize their operations and licensed. Under section 4(1) of the Mining Act, to prospect, explore, mine, retain or dispose of any mineral without a license, any person mining without a license, upon conviction is liable to a pay fine of Shs 500,000= shillings or imprisonment not exceeding one year. In case of a company, the fine is not exceeding Shs 1 million.
However, in a tongue-in-cheek presentation, Mr Kato pledged to organize artisanal miners. “We need to regulate and formalize Artisanal and Small Scale Mines (ASMs), they have become a menace all over. Government shall organize and license artisanal miners and transform their activities into formidable and viable business entities,” he said contradicting himself.
Artisanal Miners have formed associations in a bid to formalize their mining activities. However, government has been reluctant to recognize these associations. For instance, artisanal gold miners in Mubende formed and registered Ssingo Artisanal and Small Scale Miners Association. The association applied for exploration licenses. The Directorate of Geological Survey and Mines (DGSM) didn’t decline to grant artisanal miners a license, but did not even give them feedback. Failure to give feedback contravenes Mining Act, 2003.
“We shall ensure that artisanal mining is a preserve for Uganda citizens and encourage joint ventures for small scale mining operations,” he said.
In a clear contrast and manifestation of lack of coordination, Mr. Alain Goetz, the Chief Executive Officer (CEO) of African Gold Refinery (AGR), seemed to praise artisanal miners for their constant supply of gold to the refinery. He said his company will work closely with artisanal mining communities in Mubende to ensure that artisanal miners maximize their returns, perhaps not aware that they were evicted from the mines.
A CASE FOR KARAMOJA EXPLORATION
Dr Elly Karuhanga, the chairman Uganda Chamber of Mines and Petroleum (UCMP) asked government to earmark $ 20 million dollars for the geophysical Aerial survey of Karamoja. The area was left out due to insecurity then. “Why can’t we as a country mobilize $ 20 million dollars (approximately Shs 70 billion) and explore Karamoja, a basket for our mineral” Hon. Karuhanga said. Geophysical Aerial survey help to determine the minerals available in an area.
On her part, Speaker of Parliament, Rebecca Kadaga pledged to “harass” the Ministry of Finance, Planning and Economic Development to find the money to finance geophysical Aerial survey for Karamoja. “We can’t find $ 20 million dollars? Really, I think this is lack of focus and commitment towards the mining sector,” Kadaga said.
By Edward Ssekika
Muloni Tables Kanywataba Oil Agreement before Parliament signed with Armour
Gov’t earns Shs 1 bn in signature bonus for Kanywataba oil block
Government of Uganda signed a Production Sharing Agreement (PSA), and issued a License for Petroleum Exploration, Development and Production over the Kanywataba Contract Area with Armour Energy Limited (AEL) from Australia. The exploration license was signed on Thursday, September 14 at Amber House in Kampala. Energy Minister, Irene Muloni signed on behalf of government, while Armour Energy Limited was represented by its Chief Executive Officer. The Kanywataba Contract Area is located in Ntoroko district.
Eng. Irene Muloni, Minister of Energy and Mineral Development said, “This is the first Production Sharing Agreement to be signed in line with Section 58 of the Petroleum Exploration, Development and Production Act 2013, the Legal regime under which I announced the First Competitive Licensing Round during February 2015” Muloni said.
She added, “A signature bonus together with research and training fees, and annual acreage rental fees for the first exploration period amounting to US$ 316,000 have been paid to the Uganda Petroleum Fund”.
The Kanywataba exploration license has an acreage of 344 square kilometers for four years split into two periods of two years each. Muloni said, a minimum work program which includes acquisition of seismic data and drilling of at least one well.
Muloni said, the PSA provides for a requirement to train and employ suitably qualified Ugandan citizens has been provided for in addition to payment of annual training fees to government.
“The award was cleared by Cabinet and the Ministries of Finance, Planning and Economic Development together with that of Justice and Constitutional Affairs. The Minister also said that on Friday 8th September 2017, Cabinet approved the award of two licenses in the Ngassa block and that the agreements would also be signed in a few weeks’ time,” Muloni said.
Weighing in on the exploration license, Robert Kasande, the acting Permanent Secretary, Ministry of Energy and Mineral Development, added that one of the major achievements from this licensing round was the development of a state of the art data room which remains open to the industry to view and purchase data, and will also be used for future licensing rounds.
“The Ministry was able to generate $ 2.4 million United States dollars (Approximately Shs 8 billion) from the sale of data to bidders which was paid to the Uganda Petroleum Fund”, he said.
Uganda’s first licensing round covered six blocks with a total acreage of 2,674 Km2 in the Albertine Graben, Uganda’s most prospective sedimentary basin. Out of the nineteen (19) applicants at the Request for Qualification Stage, sixteen proceeded to the Request for Proposal stage and four emerged successful and proceeded to the negotiations stage. This first licensing round was undertaken in line with the National Oil and Gas Policy for Uganda (2008) and in accordance with the Petroleum (Exploration, Development and Production) Act 2013.
The signing of a Production Sharing Agreement and an award of exploration license bring the number of companies in Uganda’s petroleum industry to four – Total, Tullow, Cnooc and now Armour Energy Limited.
PSA tabled before Parliament
Later, in a move to enhance transparency in the oil and gas sector, the minister tabled before Parliament Production Sharing Agreement (PSA) signed between the government of Uganda and Armour Energy Limited – Australian oil company, over Kanywataba oil block in Ntoroko district.
The oil sector unfortunately remains shrouded in secrecy. The previous Production Sharing Agreements between government and oil companies have been under key and lock and neither accessible to Parliament not the public. A court case filed by two journalists Charles Mwanguhya Mpagi and Angelo Izama to have the oil agreements made public didn’t yield any results.
The Minister also tabled before parliament the Intergovernmental Agreement between the government of Uganda and the United Republic of Tanzania on the crude oil pipeline outlining the contents of the agreement.
Under the Petroleum Act, 2012, the Minister of Energy and Mineral Development is mandated to furnish parliament with periodic reports about the oil and gas sector.
After tabling the report, the opposition Chief Whip Ibrahim Semujju Nganda moved a motion that the report be differed for further consideration. “We shouldn’t rush through a report of this significance to the country. It is important that Members of Parliament discuss the report, when the atmosphere is peaceful and conducive for discussion not that of intimidation,” Semujju who is also the Kira Municipality MP said.
On his part, Stephen Birahwa Mukitale (MP Bulisa), dismissed Muloni’s report as lacking. “The report is devoid of figures, it is devoid of the budget, deadlines, how can we talk of oil and even have first oil by 2020 without a budget and deadlines,” he wondered.
He added, “We need a matrix spelling out the role, budget and responsibility of each and every ministry and department in the oil sector, because this is a multi-sectoral sector, if we are to have first oil by 2020,” Mukitale proposed. Kadaga asked the minister to avail the matrix to the committee.
He said it is wrong for the Minister of Energy and Mineral Development to purport to speak for the Ministries of Water and Environment, Works and Transport and Uganda National Roads Authority (UNRA) and accused the minister of lack of coordination. “There is no road contractor in Bulisa, don’t take us for granted. Other ministries don’t have a budget for oil and gas activities. The president talked about a budget cut of 10 percent from every ministry to finance oil and gas activities, where is that money,” he wondered.
Prof Morris Ogenga Latigo (MP Agago North) wants the previous oil agreement to also be tabled before parliament and MPs allowed access. “I wish the minister could table Production Sharing Agreement for oil blocks where we have already discovered oil,” Ogenga wondered.
Ogenga who is also the chairperson of Acholi Technical Working Group on oil and gas implored fellow lawmakers to read and scrutinize the Kanywataba Production Sharing Agreement warning them that if parliament doesn’t provide oversight for the sector, then the country would be in trouble.
Speaker, Rebecca Kadaga, referred the Minister’s report and the Kanywataba oil agreement to the Committee on Natural Resources to scrutinize the report and report back to parliament. However, no time line was given on when the committee is supposed to report.
About Armour Energy
Armour Energy Limited focuses on the discovery and development of natural gas and associated liquid resources in Australia. Armour Energy Limited was founded in 2009 and is based in Brisbane, Australia. It has 100% interests in the McArthur, South Nicholson, and Georgina Basins covering an area of 33 million acres in the Northern Territory and Queensland; and interests in the onshore Gippsland Basin, Victoria in joint venture with Lakes Oil NL. The company, through its subsidiaries, also holds interests in 7 exploration permits for minerals in Queensland among other oil and gas exploration works.
Got Apwoyo sub county is headquartered somewhere inside a tiny structure in Nwoya district, tucked behind the Gulu – Pakwach highway. Turning off at a trading centre is a small road that leads to the quiet two-roomed establishment.
The trading centre, a product of one of the several Internally Displaced Camps during the wanted warlord, Joseph Kony’s Lord’s Resistance Army insurgency in northern Uganda, is littered with grass thatched structures.
The area is fairly cool, it’s the rainy season. Endless tracts of green vegetation are visible are along the highway. Expansive gardens of cereal are visible too. In the background of the sub county office is expansive maize garden. It looks healthy.
The region, having not been cultivated for a long time during the insurgency, has very fertile soils. In fact there are agro-based companies cultivating on very large scale. But beneath the agricultural potential here, lie simmering emotions and a sense of hopelessness.
Mr Openy Ben Latim, the LC3 chairperson Got Apwoyo sub county, is a very bitter man. Nwoya district lies in the Albertine region which harbours Uganda’s oil fields. Across the highway is the Murchison Falls National Park where Total E&P won production licences for oil and gas in the Exploration Area (EA1).
Despite the proximity, Mr Openy is not optimistic at all and says the people are not happy. During the initial oil exploration in the park while prospecting for hydro carbons, locals and leaders did not know what was going on.
“I don’t think we are going to benefit anything. Youth would come from Kampala to work here when we have our own. They used to bring everything from Kampala. Trucks used to bring vegetables for those people yet here we can grow vegetables,” Openy says in a bitter tone.
The explanation that Nwoya district is part of government’s master plan for the oil sector – the standard gauge railway poised to run through the district, a network of roads in the park, feeder pipelines linking to the Central Processing Facility in Buliisa – does not offer any comfort.
In fact, the mention of Buliisa irks him the more. “You see, everything happens in Nwoya but ends up in Buliisa,” he says.
A story is told of how a group of locals once intercepted a truck that was leaving the park because they believed it was carrying crude oil. The truck was one of several that delivered suppliers then to the camps in the park during the exploration.
At Anaka Sub County not far from Nwoya district headquarters, the sentiments are not any different. Mr Opobo Geoffrey, the LC3 chairperson, said it was absurd that oil companies could not give their people simple jobs like security guards or drivers.
“We do have those certified drivers here but they cannot get jobs there,” he said when asked if some of the locals were certified drivers.
“We do not know anything that is going on there in the park. The only thing we know about Total is the scholarships some of our youth get. I so far have four students benefiting, but that is it,” he said.
The now Pakwach was curved off Nebbi district. Mr Okumu Benson is the LC3 chairperson Pakwach Town Council. He too adds his voice saying they do not have information about the oil activities in the district.
In the compound of the town council offices stands a Total – that now has a production licence for EA1 in Murchison Falls – branded notice board. Also a Total branded ‘suggestion box’ is pinned on the main administration block. Mr Okumu says the oil company occasionally pins up general information about developments in the sector but locals interpret it otherwise.
“They usually find their way to the camps and claim they advertised jobs. We wonder where they get that information but it’s because people are desperate. Sometimes they accuse us of hiding oil jobs from them,” Okumu says.
Mr Aguta Jimmy Frank, the Pakwach town clerk, says because of lack of information has misled people. During the exploration stage there was a wide spread problem of land speculation in the Albertine region because of oil.
“People here sold their land at giveaway prices to speculators. Our people were taken advantage of and now they blame the government,” Mr Aguta says. Expectations remain high now that production phase is upon the country. Chairman Okum says they were told at a workshop in Kampala that 13,000 jobs would be created for Ugandans. But there is a catch.
Not all about oil
“This is the time to seize opportunities in the oil sector,” Paul Tumwebaze of Civil Society Coalition on Oil and Gas once told a youth workshop in Masindi. This is a statement that has countless times resonated at numerous oil and gas workshops, the media and conferences under the flagship of ‘local content’.
Whereas several Ugandans have pinned hopes on oil since prospecting started industry stakeholders advise about the immense opportunities available to feed off the value chain of the sector.
While meeting local government leaders, all of whom have been mentioned above, Didas Muhumuza, the ActionAid Extractives Governance project manager, who has immense knowledge of the sector as well, passed on the same message.
Specifically rallying for the inclusion of youth in accountable governance of the oil and gas sector, he reiterated that the industry will not absorb every Ugandan looking to join the sector.
“The decisions government is taking now as we enter the production phase were informed from what has been gathered since exploration started. There is nothing we can change now, but can work within the existing infrastructure,” Muhumuza told the meeting at Got Apwoyo Sub County.
Chairman Openy had endlessly lamented that Nwoya was being sidelined, wondering why the oil pipeline network that will be draining in the Central Processing Facility should be located in Buliisa. Mr Muhumuza was at pains to explain that because Murchison Falls is a protected area much of the activity could not take place there.
While many of the leaders lamented their youth were not equipped to position themselves for opportunities through skilling and training, there are organisations like the GIZ-funded Skilling Uganda that are offering these opportunities. The programme is targeting to skill 8,000 youth in welding, driving, carpentry, electrical which will be on high demand during the production phase.
ActionAid Uganda under the Extractives Governance is rolling out a two-year Ford Foundation supported intervention to sensitise youth and build their capacity to gain an understanding of the extractives sector and use their knowledge to engage state and corporate actors in the accountable management of the sector. The project focuses on four Albertine districts of Hoima, Buliisa, Nwoya, Nebbi; and Mubende district.
Fortunately some of the leaders are not hopelessly waiting for the magic bullet. Mr Shaban Kinobe. LC3 chairman Panyimur Sub County said everyone is looking at oil whereas opportunities are abound in the value chain. Many of the leaders however expressed optimism about the new project, “People in Power; Influencing People in Power.
He denies knowledge of eviction plan by his army!
Mr Museveni expressed this last week ( Friday 8/09/2017) while meeting the leaders of Mubende at the State Logde in Nakayima, Mubende. The meeting comprised of the area Members of Parliament, Residential District Commissioners, District Internal Security Officer, Regional Police Commander, District Police Commander LC111s and LCVs.
When asked his whereabouts at the time of evictions by his army men, President Museveni defended self, saying his intervention was overtaken by events.
“I had wanted to come and talk to these artisanal miners but there was a misunderstanding when Members of Parliament requested me to first talk to the miners and at the same time the army officers that had been put on standby went ahead with the operation, evicted the artisanal miners and they were also denied the chance of taking their property which was not right and un necessary,” Mr Museveni said.
Here he promised to ensure that miners are compensated, although he admitted that it may be difficult and may take time but allowed miners to return to work.
This same message, the President re-echoed during the radio talk show on Point FM in Mubende on Friday.
Mr. Museveni added that; “Earlier on during the Presidential campaigns, I informed the artisanal miners that they can continue with mining activities if they do not stand in the way of large scale investors that are helping us find the real gold deposits but later on, I was informed by the members of parliament that the artisanal miners operating in this area have invaded the land offered to the investor and are antoginising his work, contrary to the contract,” he said.
He further explained that he has no problem with artisanal miners that were operating in this area; “we only needed to re-organise the mining sector by having the local artisans doing proper mining activities.”
Mr. Museveni added that; “Uganda is endowed with very many minerals that we need to handle with care, we cannot allow the illegal mining activities to be carried out which might lead to extinction of these treasures yet with few people benefiting. We all need to benefit from the minerals as a country.”
Meeting with ASMs
The President told Hon. Semeo Nsubuga, MP Kasanda South to organize the miners for a meeting with the President to streamline how the miners will work.
Speaking to Oil in Uganda; The secretary Singo Artisan Miners’ Association Mr Emmanuel Kibirige confirmed that they were contacted by Hon. Nsubuga to prepare to meet the President.
“We are ready to meet the President; we want him to understand how organized we are and how ready we are to work with investors so that all of us benefit from the Mining sector,” Mr Kibirige said.
Kibirige indicated that they have always been organized in associations and have always shown the willingness to work with the investor-AUC mining which currently holds the exploration license for this area-207.8Sqkm and a mining lease of 66sq.km which has been running for the last 23years.
The President has shown willingness to support the ASMs, with a planned visit to the mines slated for 21st October to mend fences. There is thus assurance that the miners may return to work but in a more formal way, more organized manner.
Last month there was a Presidential directive to evict over 50,000 miners from Mubende gold mining area on grounds that the people in the mines are not registered, government doesn’t know the amount of gold getting out from this area, the people operating in this area are not Ugandans and increased environmental degradation which is a threat to the nearby communities.
Many of who were evicted had no relocation plans hence were left helpless and homeless. During the evictions, property worth billions of shillings were destroyed.
However the former Permanent Secretary under Ministry of Energy and Mineral Development Dr.Stephen. Isabalija in the letter dated 02/9/2017 entitled ‘statement on illegal mining activities in Uganda’ explained that government was putting in place intervention for all the local artisans to be registered in all mining areas of Kitumbi and Bukuya sub counties so that they can be organized into groups that shall ultimately be regulated. This process he said would take three months.
ActionAid Uganda is equally working out a plan to support the miners to sue the Government for losses that ensued during the evictions an d the impromptu evictions without respecting the grace period that had been granted to the miners.
Josephine Nabaale and Flavia Nalubega
Globally, oil and gas activities are known for its degrading and destructive effect on the environment. In Uganda, there are already fears that oil and gas activities in the Albertine graben could destroy the fragile ecosystem. This calls for increased close monitoring and early mitigation measures to be put in place.
District leaders from the oil rich Albertine graben want government to establish a special fund dedicated to helping district environment officers to routinely monitor the impact of oil and gas activities on the environment and undertake early mitigation measures.
Bulisa district chairman Mr Agaba Simon Kinene said, “As a district, we are implementing oil and gas industry at zero budget, yet we are decentralized,” he said.
The oil production phase, is expected to generate a lot of hazardous or non- hazardous waste. Therefore, district environment officers are expected to take a center in ensuring that all the oil waste generated and pollution are properly managed.
As Uganda prepares to started oil production, a lot o is preparing for District Environment Officers (DEOs), have often complained of lack of facilitation to monitor oil and gas activities.
Mr Philip Ngongaha, the District Environment Officer, Bulisa was bolder and called for the establishment of a fund to help them monitor oil and gas activities. He said currently, district environment officers lack facilitation to do their work. “We need a special fund to facilitate oil and gas monitoring,” Ngongaha argues.
He argued that the fund would help the environment officers acquire modern equipment for monitoring. “You cannot expect an environment officer to monitor noise pollution using naked eyes. We require modern equipment,” he said.
The leaders were speaking at an oil and gas conference organized by Advocates Coalition for Development and Environment (ACODE) at Imperial Royale Hotel in Kampala last month.
He argues that given the environmental concerns that are expected to come with the petroleum sector, it is important to allocate enough resources to monitor any changes in the environment and make early mitigation measures. “Local environment committees provided for under in the law but are not in existence,” he said.
“I wish to concur, we need a special fund for environmental officers, to monitor these activities otherwise, we shall keep taking when the environment is being depleted” Paul Mulindwa, the Program Coordinator, Kibaale District Civil Society Organizations Network said.
Presenting a paper on the impact of oil and gas on local government, Nwoya District Chairman Mr Patrick Okello Oryema wondered how district environment officers monitor oil and gas activities without being facilitated to do their work.
However Ms Aijuka Sarah, the Environmental Monitoring Officer in charge of Oil and Gas at the National Environment Management Authority (NEMA) explained that the authority is already drafting the National Oil Spill Management Regulations and contingent plan.
“We already have oil waste, but we are still lacking regulations on how to handle the oil waste,” Ms Aijuka explained. Aijuka said the environmental watchdog operates on an assumption the district environment officers have money for environmental activities, an assumption that she said won’t be held anymore but rather consider the lack of finances and see how best to have the people facilitated.
The muddled procurement of the lead developer for the oil refinery could have played a role
President Yoweri Museveni on Wednesday, in a surprise twist of events, fired the Permanent Secretary, Ministry of Energy and Mineral Development, Dr Stephen Isabalija. Though the President did not give reasons for the surprise sucking, analysts within the Ministry of Energy and Mineral Development argue that the messy handling of the procurement process for the oil refinery lead developer could have played a hand in Isabalija’s sacking.
Mr Isabalija was only 10 months old into the job, after replacing the long serving Fred Kabagambe Kaliisa during a reshuffle of Permanent Secretaries in November last year. Kabagambe Kaliisa is now a Senior Presidential Advisor on Oil and Gas.
The President appointed Robert Kasande, the acting director, Petroleum Directorate in the Ministry of Energy and Mineral Development, as the acting Permanent Secretary. Mr Kasende, a geologist by profession, was also the project manager for the oil refinery project.
Isabalija’s sacking that started as a rumor on Wednesday, was later on Thursday confirmed by the Executive Director, Uganda Media Center and government spokesman Ofwono Opondo who twitted, “Dr Stephen Isabalija’s contract has been terminated and he is to be paid one month in lieu of notice,” Opondo said.
He said the President did not give any reason for the terminating Isabalija’s contract. During his short stint at the Ministry, Isabalija’s oversaw the eviction of over 60,000 artisanal gold miners in Kitumbi Sub county, Mubende district. Government claims that the artisanal gold miners were illegally mining gold and want an “investor” to take over.
MESSY OIL REFINERY PROCUREMENT
Dr Isabalija an academic and former Vice Chancellor, Victoria University, could have burnt his fingers in the procurement process of the lead developer for the oil refinery.
Early this month, Dr Isabalija announced Albertine Graben Refinery Consortium (AGRC), a consortium of American and Italian companies, as the winner for the oil refinery deal. This edged out a Chinese Consortium led by Guangzhou Dong Song Energy Group Limited, that accused the selection panel of corruption.
Guangzhou Dong Song Energy Group Limited, was granted a mining lease to develop the Tororo Phosphates.
The Chinese consortium includes; Guangzhou Dong Song Energy Group Limited, Guangdong Silk Road Fund, China Africa Fund for International Corporation, China Petroleum Engineering and Construction Corporation (CPNC) and the East Design Institute.
After being edged out in the $ 4bn dollars refinery deal, the Chinese penned a letter dated 8, August, 2017, to the Minister of Energy and Mineral Development, Irene Muloni copied to the Prime Minister in which the consortium expressed shock at the announcement.
“We are taken aback by press reports indicating that the government of Uganda has reportedly selected a group known as Albertine Graben Refinery Consortium to develop the refinery project. Incidentally, the same press reports indicate that the Dong Song – CPECC consortium had been appraised as the best bidder with 83.38 percent,” reads the letter signed by LV Weidong, on behalf of Dong Song led consortium.
It added, “The purpose of this letter is to inform you that the Dong Song – CPECC consortium has never disintegrated. It remains strong and committed to invest in the development of Uganda Refinery project provided the concerns raised in the consortium’s earlier letters are addressed. The letter reads.
The consortium even threatened to challenge the procurement process that led to the selection of any other consortium in courts of law. They also complained that the only reason, they were denied a deal is because, the consortium members are close to President Yoweri Museveni.
“Dong Song is suffering because it is close to the President. There is no way it can give money to people involved in the selection process,” an official is reported to have said. This year, two officials from the Ministry of Finance tried to solicit for money from Guangzhou Dong Song Energy Group Limited, the president laid them a trap and they were arrested.
The Chinese also alleged corruption in the way the deal was awarded. “So, we were edged out, because they know we can’t give them money,” an official of the consortium is reported in the local press to have complained.
One of the Consortium members, CPECC, a subsidiary of CNPC has demonstrated capacity having built refineries in South Sudan, Algeria, Chad and Niger. However, selection committee is reported to have edged out Dong Song consortium because they didn’t provide their intended financiers.
The Chinese are also known of using powerfully connected individuals some of them members of the first family to broker their deals. Guangzhou Dong Song Energy Group Limited, used the President to get the Tororo Phosphates Deal. It is this politics of balancing interests, that could have landed Isabalija in trouble and could have had played a role in sacking.
Kawunde Patrick has been in the gold mining business for three years now. Previously he was a timber dealer and before that he traded in South Sudan until unrest broke out. On the fateful morning of the Mubende mines eviction, he watched in horror as his livelihood was swept right from under his feet.
The 35-year old father of five had a pit in the mines. On that fateful morning his boys were already in the pit working when he was ordered by angry soldiers to get them out and ensure no one stayed down. The miners had been given two hours – though most swear it was hardly an hour – to vacate the mines. Pandemonium reigned as over 50,000 people gathered whatever they could to flee.
Preoccupied with getting his boys out of the pit Kawunde had no time to pick anything from his house. By the time he got there the padlock was broken, his house ransacked.
“Soldiers stopped me from taking anything. I lost three generators; three blowers that supply oxygen down the pit and four drilling machines,” Kawunde painfully narrated his ordeal.
He valued the generators at Shs3million each; two blowers at Shs2.2million each and a smaller one at Shs700,000. The drillers together cost Shs4.4million.
“I watched as Sh16million of my capital was snatched out of my hands,” he said resignedly with tears welling up in his eyes. A week later he found out his Sh9million ball mill had been taken too.
“In my lifetime I have never seen anything like this,” he said in a distant voice.”
Mr Kawunde is just one of many artisanal miners that lost property and money during the eviction.
“People left money in their houses as they fled,” said another miner who identified himself as just Alex. Alex was one of so many business people who fled off the gold value chain. He owned a lodge and bar. He had just spent Shs6million on iron sheets to construct more makeshift rooms. Like many others he left his iron sheets in the mines.
“If I had not bought those sheets I would at least have something to start with. I left everything of mine in the mines. I have not changed clothes since we were evicted,” he said.
Another miner of Rwandese origin had his Toyota Premio confiscated by police when he was asked to produce his national ID which he had misplaced in the fracas.
Led by Ntare Sipriano, the LCI chairman Lujinji B, an angry group of miners still camped in the trading center just outside the mines said the military men told them they had orders to take over the place and confiscate everything.
“A few lucky ones had managed to get out some property before the place was put on lockdown,” said one of them.
To the ordinary eye artisanal gold miners spend day in and out torturously excavating stone and go through strenuous means to extract gold from the ore. Yet in fact the clueless miners are counting losses since their eviction early this month. Clueless because every government stakeholder they believed had given them assurance of their continued operations right from the fountain of honour has betrayed them.
Mr Bukenya Michael, the Bukuya constituency MP, said they had ‘done everything possible’ to stop the evictions, lobbying in higher offices but were powerless to stop anything.
In his State of the Nation address of 2015 President Museveni assured the miners in Mubende their plight would be addressed. For five years now the miners have waited for a location license in vein. This year, with the eviction looming, negotiations were ongoing as politicians shuffled between State House and Mubende.
Mr Emmanuel Kibirige, the secretary Singo Artisanal and Small Scale Miners Association said Benny Namugwanya, the Woman MP Mubende, was supposed to have given them feedback from a consultation meeting she had attended in Kampala over their plight. Other than what had transpired they were expressly evicted albeit earlier directives to vacate that they mostly took casually.
“We have lost our lives and livelihood. Our government has done it again to further marginalize the poor. Thanks NRM. Our property worth millions is in the hands of soldiers. Only two hours to shit items after working for ten years,” Kibirige says bitterly.
Kibirige wondered what would become of people’s property as there wasn’t any sort of documentation taking place.
“I have an acre of land I bought in that place and have a land sale agreement for it. What has it got to do with the mines? We would not have refused to leave the mines but should have let us take our property,” Kibirige, who sustained a broken leg in the fracas, says.
After years of toiling several of the miners own pits. Inclusive of paying rental fees to landlords, hiring generators and drilling tools, and labour, operating a pit cost up to Sh500,000 daily, according to Ivan Kawuma, another miner. Kawuma owned a pit more than 300 feet deep after working for more than five years.
What has however left several people baffled is their machinery that they were using in their operations. People were not allowed to take their machinery. Miners have also reported seeing a military police truck driving out of the miners with generators, blowers, and other equipment like drillers.
When asked about people losing property Mr Byaruhanga Patrick, the district police commander Mubende, said those were exhibits to adduce as evidence of illegal mining otherwise people had managed to carry out all their other belongings.
For now the miners are waiting and hoping that they will be allowed back to operate or at least seize opportunities if an investor starts operations.
By Robert Mwesigye and photos by Josephine Nabaale
Over 50,000 artisanal miners operating in Mubende district were ordered to vacate the gold miners within a period of two hours on Friday 04/08/2017.
This operation to evict all the artisanal gold miners in Mubende district is was led by Col Balikuddembe Lutaaya commander 1st division in Uganda People’s Defence forces.
The miners were told to leave the mining sites in Kitumbi and Bukuya sub counties but were not given ample time to rescue their mining equipment.
A troop of Uganda peoples defence forces and Uganda police forces totaling 750 people, 4 tear gas vehicles and tanks were stationed in the gold mining sites in Kitumbi and Bukuya sub counties forcing the gold miners and other people operating business with this location to pack their belongings to leave the mines.
Mr Sempowo Robert the chairman Mubende artisanal miners explained that they has been woken up by the sound of lorries moving into the mines that were packed with Uganda peoples defence forces soldiers and Uganda police forces officers who ordered them to vacate the premises within two hours and by midday no single person was to be found in the mines.
Sempowo added, “Currently most of the miners in this area are packing up their belonging to leave the premises ,others have abandoned their property for lack of money especially the heavy machinery while other are selling the property at a giveaway price so that they can live this place before it’s too late.”
“Government is not fair, because there was no official communication to neither the leaders or to the gold miner to vacte the gold mines , we have been relying on rumours and hear say, its a shock to us all our efforts have been shattered one investor. ”Sempowo expressed.
Ivan Male Kawuma, the Project Coordinator Singo Artisanal Small Scale Miners Association said that “we are being treated like non Ugandans, how can we become like refugees in our own country. There is no communication, no compensation for the money invested in our business running in the gold mines. This has been our main source of livelihood and we don’t know what we are going to do next.”
His Excellency Yoweri Kaguta Museveni the president of Uganda in his letter addressed to the hon. members of parliament Mubende district dated 28/June/2017 made it clear that;” those artisanal miners who invaded where the investor had excavations must straight away get out.
The evictions folowed the presidential directive to evict all the artisanal miners in Mubende district on grounds that the people in the mines are not registered, government doesn’t know the amount of gold they are getting out from this area, the people operating in this area are not Ugandans and increased environmental degradation which is a threat to the nearby communities.
However the permanent secretary under ministry of energy and mineral development Dr.Stephen. R. Sabalija in the letter dated 02/08/2017 entitled Statement on illegal mining activities in Uganda explains that government is putting in place intervention measures whereby all the local artisans will be registered in all mining areas of Kitumbi and Bukuya sub counties so that they can be organized into groups that shall ultimately be regulated.
This intervention is anticipated to take 3 months and will subsequently help the ministry of Energy and Mineral development to re-organise mining activities supported by Uganda police force, Uganda people’s defence forces, Directorate of citizenship and immigration control under the Ministry of Internal Affairs and will be led by Ministry of Energy and Mineral Development.
On 21st June, the three prime ministers from Ker Kwaro Acholi, Alur Kingdom and Bunyoro Kitara Kingdom launched Guidelines to equip cultural leaders in their institutions in managing their relationship with the oil and gas companies as productively as possible.
The guidelines reflect the three cultural institutions’ determination to play an active role in preserving tangible and intangible cultural heritage, in ensuring sustainable development and in fostering peace amongst communities.
Oil in Uganda’s Robert Mwesigye talked to the Executive Director Cross Cultural Foundation Uganda, Emily Drani, on the milestone the Foundation has made and their expectations following the landmark event of the launch of the guidelines by cultural institutions for oil and gas companies operating in Uganda’s Albertine region.
What have been your major achievements 10 years down the road?
Our achievements over the ten years especially with regards to what we are doing right now is that we have come to understand the relevance and role of cultural institutions; we have taken into account some of their strengths but as well as their weaknesses as we have worked with them especially those willing to address those weaknesses through capacity building, documenting and reflection events. We have documented statements that they have made linked to the citizens manifesto.
In that statement they have highlighted their responsibility but also the demands they are making from the Uganda government and development partners. But they have also made commitments in respect to what role they play today. Of course the role of cultural leaders has evolved today. What they did 50 years ago is not what they are doing today. And one of their roles is protection of the natural resources. There are about twenty two points and this is just one of the points where they said we have a role to protect the environment because of its cultural significance, not its economic value. And so the question is what shows and how can you guide other cultural leaders who have just become leaders today about that responsibility. So today is actually about the responsibility they have taken because we’ve worked with many cultural leaders across the country and they might have responsibility but it’s not documented. It sounds very general and something that is very hypothetical so this is a practical way that they have committed on paper that they are responsible for a number of issues that they are going to take on that responsibility.
Uganda right now is abuzz with extractives development for which cultural institutions have been advocating to have major participation. Do you feel government is responding or is there need to do more?
I think there is much more that needs to be done to harness the influence and authority that cultural institutions have. There has been often a thin line between their authority as institutions and then their political authority. And therefore they have always been treading very carefully. So when it’s a purely development agenda they are very outgoing and very forward. But when there’s a very thin line as to whether they’re now overstepping that line you find they’re not very assertive. So much as the laws of energy and use of natural resources have been taking place they have not asserted themselves to say yes, we are key actors in all this and we need to be consulted and we need government to recognize that the resources were talking about also have cultural significance and that’s where we come in, because in the past of course they were managing those resources for economic benefit and now they are told that is something beyond their mandate; they are supposed to focus on culture. But even then they can still make a case for land; they can still make a case for natural resources where there’s traditional medicine, there’re secret sites which fall directly under their mandate but they’re not very forthcoming. Government has taken advantage of that and actually not consulted them; but also for government to consult you need to demand and be acknowledged that this is a place where you can make a contribution.
How would you rate the level of responsiveness by oil exploration companies to the call to conserve cultural sites/ heritage while carrying out their activities?
I think there are a couple that have been quite forthcoming because I know Bunyoro kingdom received funding from think Tullow ( Tullow funded Bunyoro Kingdom to the tune of 1000USD to facilitate construction of a museum that never was. This was meant to enhance the protection of cultural Heritage visa viz oil and gas operations ). They gave them a significant amount of money to build a cultural centre and that was without too much lobbying. They felt that was there corporate social responsibility. But I’m not sure about the others. I have not heard because we’ve done some reviews on the relationship between cultural institutions and these oil companies where they have just gone out of their way to (i) recognize culture matters (ii) to give some incentives to the communities to preserve their culture but (iii) also to find out if they can be guided where there’s a space of cultural significance and if there is any way they can avoid that. That on record has not been very strong. You might want to dig deeper on how a number of sites have been desecrated.
The cultural institutions are more concerned about oil & gas; have they considered other extractives? Because we’ve been to Moroto, the situation there is not so rosy.
No. I think the oil has brought to the fore that there’s significant benefit that can accrue to the community. But in other areas; for instance, there’s marble in Moroto but the council of elders there is very small. We know there’s salt extraction, there are different minerals being extracted from different places. I think some of the cultural institutions think that is a government preserve. And especially where there is a bit of contention over ownership as you have seen Bunyoro clashing over the forest with the National Forest Authority. So that I think has made a number of them not to be very forceful in their demand not only to be consulted but to benefit.
The level of awareness and agitation for inclusivity in the extractives sector in Uganda by cultural institutions is quite prominent in the Bunyoro region. Do you feel that resonates elsewhere in mineral host communities?
For us as an organisation usually respond to need. Of course we have different communities where there are different resources; it could be a forest; it could be a natural resource of another nature, mineral or something. But if the cultural institution itself has not seen that need, we are not going to go there and say you need a role in this. They need to say traditionally we have been responsible and now we’re being left out. Then we can partner because they have their traditional mandate but it’s not our job to go and start instigating that responsibility and interest.
An MP at a workshop said there was a resurgence of ethno-nationalism where cultural institutions are agitating for priority in sharing on what is a national resource. What is your view?
Well CCFU tries to learn from other countries. And learning from other countries we actually invited cultural leaders from Ghana where there is gold. And in Ghana fortunately for them the government recognizes cultural institutions. They are actually part of the legislation. But they have royalties there and I think that helps to diffuse some of the conflicts that you might have with the government and I think they do have a case because the land is part of what you should call Bunyoro Kingdom. So we don’t see any problem with Bunyoro kingdom demanding to have a percentage of the royalties. It’s maybe what it’s going to be used for or whether the community is going to benefit. That’s a question to be answered. But the principle that they should receive royalties is a valid one. Absolutely!
Going forward after today’s dialogue what are your expectations?
What we are hoping to see is that some of the three cultural institutions that are here pick up on some of the guidelines and operationalise them. It’s difficult for them because they always have challenges with resources but they are things that can be done practically without finances. And they can have negotiation with oil companies and say this is what our desire is and it’s standard now which has been set so we expect them to use it and for those who have not had an opportunity to develop guidelines we hope they’ll be able to borrow some of the principles in there. When they are dealing with investors, people in the extractives industry they’ll say yes, please could you adhere to some of these principles because it’s about the preservation of our heritage.