Kampala – China’s state-owned oil firm China National Offshore Oil Corporation (CNOOC) has won a $2b deal to develop an oil field in Uganda oil.
The Kingfisher field is estimated to hold 635 million barrels of oil, of which 196 million are recoverable.
It is the latest in a series of investments by Chinese firms in overseas oil and gas resources.
Chinese firms have been looking to secure energy resources to meet growing domestic demand.
CNOOC will develop the Kingfisher oil field over a period of four years.
According to Peter Lokeris, Uganda’s junior energy minister, the field will have an initial capacity to produce between 30,000 and 40,000 barrels of oil per day.
The minister said the production of the Kingfisher field will also lead to production of associated gas, which will be used to generate electricity for operating the facilities. Commercial oil production is expected to start by 2018, according to Lokeris.
Uganda has 20 fields in the Lake Albert Basin, which is the most prospective area for petroleum production in Uganda. Kingfisher is the first and only field granted the production license. Lake Albert rift has estimated 3.5 billion barrels of oil equivalent in place and 1.2 billion barrels are confirmed oil and gas recoverable.