In 2011, the Government of Uganda supported a study to examine how the country may benefit from the participation of Ugandans and Ugandan firms in the petroleum activities. The focus of the study was to identify the opportunities, gaps and challenges posed by the petroleum industry, and to recommend necessary measures to maximize the benefits of national content otherwise defined as National Participation.
In its final report of September 2011 entitled ‘Enhancing National Participation In the Oil and Gas Industry in Uganda’, the study made a total of (20 twenty) recommendations in the areas of institutional framework, capacity building in people, enterprise development, facilitating national participation, and monitoring national content achievements. The recommendations included, among others, to:
- Establish a Government body for National Content enhancement
- Define and operationalize how National Content shall be measured
- Have the Oil Companies commit to National Content development
- Have an Oil and Gas Industry Suppliers Association established
- Ensure that the National Content Policy is an integrated part of the National Development Plan
- Strengthen the capacity of vocational training
- Establish Training Centres by the International Oil Companies (IOCs)
- Establish institutions of excellence for higher level of education
- Develop an adequate capacity building program for the industry
- Encourage teaming between Ugandan and foreign firms
- Establish an SME program for the petroleum sector
- Structure contracts to align with domestic capacity
- Apply a holistic approach to monitor national content
- Establish a system for how to evaluate national content performance
It was on the basis of the key recommendation (d) above that the Association of Uganda Oil and Gas Service Providers (UgOilAndGas.com) was formed. Under this recommendation, the study further observes that ‘The private sector should be encouraged to establish an association of oil and gas suppliers. This will provide a platform for advocating the challenges of Ugandan supply and service providers to oil companies and government. In addition this enables government and other stakeholders to channel support to right beneficiaries’.
Accordingly, The Association of Uganda Oil and Gas Service Providers (UgOilAndGas.com), was launched in 2012 with a founding membership of 08 (eight) private companies. The founding companies were, in no particular order; Eagle Air, Richflo Lifting, Bemuga Forwarders, Quantum Associates, Transtrac Limited, Threeways Shipping, InterCar Limited and Globetrotters Limited. The Association now has grown to 103 (One Hundred and Three) member companies, individuals and Government Agencies that work together to improve on the capacity and standards of Ugandans in order to be ready to participate in the Oil and Gas industry. UgOilAndGas.com member firms employ over 9,000 people and most of them are Ugandans.
However, UgOilAndGas.com members have the capacity to employ over 30,000 people in all sectors. Membership is voluntary, non-partisan and by application. There is an annual membership fee that members have to pay to renew their membership.
UgOilAndGas.com is an umbrella organization that brings together local service providers in the Oil and Gas Industry. The Association is governed by the Board composed of nine members and the day-today running of the Association is done by the Secretariat headed by a Chief Executive Officer.
As one of its objectives to mobilize and lobby Ugandans to participate in the Oil and Gas service and goods delivery, the Association has found it necessary to work with women and the youth in order to develop their capacity and readiness to participate in the sector. We have helped organize five farmer groups in the districts of Nwoya, Masindi, Hoima, Buliisa and Biiso Sub County where we are working with about 30,000 farmers who are especially women and the youth.
UgOilAndGas.com regularly organizes activities aimed at improving service delivery through deliberate activities like quality assurance, capacity building through training and seminars, practical evaluation of the capacities and hindrances that the would-be service providers face, and improving on the technical know-how of the existing personnel and workforce.
Training and Certification:
The Association of Uganda Oil and Gas Service Providers, working with GIZ, UKAID and DFID trained and certified 60 (Sixty) companies in NEBOSH for Health, Safety and Environment (HSE). The eight week course was conducted by e360, an international training and skilling company.
UgOilAndGas.com also trained and certified 36 (Thirty Six) business owners and top managers in Health, Safety and Environment (HSE). All these efforts are aimed at improving the capabilities of Ugandans and Ugandan companies to participate in the Oil and Gas industry.
We have also trained 897 (Eight Hundred Ninety Seven) farmers and small business owners in the districts of Hoima, Nwoya, Buliisa, Masindi and Biiso. The training covered the areas of Basic Accounting and Book Keeping, Contract Preparation and Interpretation, Quality Assurance and Basic Record Keeping.
UgOilAndGas.com continues to look for opportunities and resources to help train more people so that more Ugandans can participate in both goods and services delivery in the industry.
Uganda and Local Content in Oil and Gas
Uganda has, over the last few years, made significant discoveries on oil and gas which have resulted into increasing interest to leverage these opportunities to stimulate the country’s development of a sustainable local industry. In an effort to ensure maximum benefit of the oil and gas resources to both current and future generations, the Government as caretaker of petroleum and minerals on behalf of the people of Uganda, is committed to ensuring that exploitation of these resources is done in a manner that creates lasting value to the society. This responsibility is exercised based on Article 244 of the Constitution of the Republic of Uganda.
To this end, Government has developed key policy and legal frameworks leading to the realization of its aspirations. The National Oil and Gas Policy for Uganda, developed in 2008, states that the primary goal is to use the country’s oil and gas resources to contribute to early achievement of poverty eradication. The policy recognizes that the benefits that shall accrue to the country will depend on the active direct and indirect participation of its citizens (individuals and enterprises) in the oil and gas sector and auxiliary services. The same policy also provided the basis for the development of the Petroleum (Exploration, Development and Production) Act 2013, and the Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act 2013, among others, which:
- Mandate oil and gas operators to conduct training, employ and transfer technology to the country;
- Imposes a preference for Ugandan manufactured goods and services; and
- Requires that goods and services not available in Uganda should be supplied by international companies in a joint venture with Ugandan companies.
The National Content Policy recognises that the current level of participation by Ugandan enterprises and individuals is limited due to a number of factors including, but not limited to:
- Lack of specialised skills relevant to the petroleum sector
- Few enterprises with capability to compete internationally
- Low entrepreneurial skills
- Limited financial capacity and access to funding
- Low level of technology
- Poor physical infrastructure
Resource demanding business regulations
