Uganda Pres Holds Talks With Total, Cnooc Execs Over Oil Invest

26th Jun 2010 08:38

KAMPALA Uganda (Dow Jones)-The Ugandan president held talks with executives of China's Cnooc Ltd.(CEO), France-based Total SA (TOT) and UK-based Tullow Oil PLC (TLW.LN) over their investment proposals in the country's upcoming oil sector, the Ugandan presidency said late Friday. A presidential spokeswoman said in a statement that during the talks, President Yoweri Museveni called upon company executives to establish an oil refinery in Uganda to create jobs, address shortage of fuel and lower prices. At least a billion barrels of oil have been discovered in three blocks in Uganda's Lake Albert basin. Tullow Oil owns one block and co-owns the other two with London-listed Heritage Oil PLC (HOIL.LN). Tullow Oil wants to take over the stakes of Heritage Oil and then bring on Total and Cnooc in a joint operating venture for the development of the oil fields in the three blocks, however the partnership awaits government's approval. The Ugandan government is also yet to approve the takeover of Heritage interests by Tullow due to disagreements over the capital gains tax on the $1.5 billion deal. During Friday's talks, company executives were led by Christophe de Mangerie, the Chairman and Chief Executive Officer of Total. Tullow and Cnooc representatives as well as the French Ambassador to Uganda Rene Forceville also attended. People familiar with the situation say that the president and company executives discussed the development plan for the oil fields. The Ugandan government insists that for companies to be allowed in the oil sector, they must have a market capitalization of at least $24 billion and must adhere to the country's oil development plans, which include early commercialization of oil, building a refinery and an export pipeline to the East African coast. -By Nicholas Bariyo, contributing to Dow Jones Newswires; 256-75-2624615 [email protected] (END) Dow Jones Newswires June 26, 2010 03:38 ET (07:38 GMT)