Uganda Business News: Museveni defends oil agreement with Tullow

President Yoweri Museveni with MPs at Parliament today.

Ultimate Media

President Yoweri Museveni has defended the government decision to sign oil agreements and grant a further license to Tullow oil despite a Parliamentary resolution against any more oil licenses.

Museveni says Uganda stands to benefit from the new oil licenses for production and prospecting as well as the oil agreements so signed.

The President who today appeared before parliament to explain the government decision said the decision was made in the best interest of the country.

He says that some government saboteurs were delaying the oil activities to deny government the chance to acquire much needed funds to develop the country.

Museveni emphasized that the monies from oil will not be used for consumption but for developing infrastructure, including cheap electricity from hydro sources, solar energy, biomass and nuclear energy.

He defended the oil agreements, saying  before the oil companies recover the costs incurred during the exploration process, they will be taking 74 barrels of oil of every 100 barrels. He says this will reduce to 42 barrel after the recovery of costs.

Museveni explained that the total government share after royalties and taxes will be 152, 326 out of every 200,000 barrels, according to agreements signed in 2001.