Uganda reviewing nine applications for oil production licences

By Elias Biryabarema

KAMPALA, Jan 6 (Reuters) - Uganda is assessing applications for oil production licences from London-listed Tullow Oil (LSE: TLW.L - news) and French petroleum major Total (NYSE: TOT - news) as the country inches closer to starting crude production, officials said on Monday.

East Africa's third-largest economy, which struck commercial hydrocarbon deposits in the Albertine rift basin along its border with the Democratic Republic of Congo (DRC (Shenzhen: 000530.SZ - news) ), expects to begin commercial production in 2016 at the earliest.

Last month, the government announced it had selected six firms to bid for the development and operation of a $2.5 billion refinery to help process the crude once production starts.

"We're currently reviewing nine applications for production licences and eight of those are from Tullow, while one is from Total," Gloria Sebikari, spokeswoman for the state-run Petroleum Exploration and Production Department (PEPD) told Reuters.

Tullow operates Block 2 while Total operates Block 1 and Block 1A. Sebikari declined to say when the review process was expected to be concluded and the licences granted.

In September last year Uganda awarded the first production licence to China's CNOOC (HKSE: 0883.HK - news) for the Kingfisher (LSE: KGF.L - news) discovery, which contains an estimated 635 million barrels of crude reserves, of which 196 million are recoverable. CNOOC plans to spend $2 billion to develop the field over a four-year period.