Uganda Oil Bill

Disagreements have arisen among members of the committee members of the Ugandan Parliament and the legislators of the Ministry of Energy and Mineral Development (MEMD) committee regarding a proposed legislative change. The government of Uganda is seeking to reclaim complete authority over the importation of fuel in the country. However, negotiations have failed to yield a consensus among the involved parties.

The committee members were prompted to generate contrasting reports, with one endorsing the government’s proposal while the other opposed the idea of the government undertaking the project.

The report on this procedure is anticipated to be disclosed during today’s plenary on November 14, 2023. In the current agreement, the government has conceded in the Petroleum Supply Amendment Bill 2023. According to the terms, the government seeks to empower its National Oil Company to assume complete authority over the direct procurement of fuel from the global market, specifically from Arabic nations and other states that are fuel suppliers.

In this strategic initiative, the Ugandan government aims to eliminate middlemen based in Kenya who have been responsible for importing fuel into Uganda. This move is driven by the perceived high costs associated with the current arrangement, as well as concerns about excessive expenditures and corrupt practices.

The government established an exclusive partnership with the Vitol Company, designating it as the sole entity authorized to transport fuel from Arab nations to Uganda. Vitol is entrusted with selling the fuel to the Uganda National Oil Company, which, in turn, is responsible for distributing it to various companies within Uganda.

The recently convened committee (MEMD), in its testimony for the current term, disclosed that most parliamentary members opposed the government’s proposed bill. They expressed dissent regarding granting Vitol Company complete control over the importation of fuel into the country.

Several Members of Parliament have expressed concerns that Vitol is not adequately suited for the specified task, emphasizing that the company lacks proper fuel storage facilities for preservation.

Contrary to previous accounts, the current opposition to the bill has a substantial membership, and unless there are significant alterations, the majority appears poised to secure victory during the plenary session.

Reports suggest that the agreements between the government and Vitol Company are currently lacking solid evidence and are deemed unreliable. Lawmakers opposing the government bill have once again expressed concerns that the passage of this bill could lead to the deterioration and potential collapse of the Uganda-Kenya relationship, especially if the Ugandan government persists in sidelining Kenyan intermediaries/middlemen in fuel transportation.

Recently, Uganda’s proposal to utilize the Kenyan Pipeline for fuel transportation to Uganda was rejected. The primary issue stems from Uganda’s intention to eliminate intermediaries based in Kenya.

Several reports suggest that Parliament members who opposed the government’s bill were once again not afforded sufficient time to articulate their reasons, despite the committee being allocated a 45-day period to conclude the matter. The scrutiny of this bill was completed in just ten (10) days, a significantly shorter duration than the initially estimated 45 days for thorough examination.


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