KAMPALA (Reuters) - Uganda may have to further delay licensing of new oil exploration blocks due to a standoff between parliament and ministers that has held up the passage of legislation to regulate the sector, lawmakers said on Monday.
The east African country suspended licensing of new blocks late last year after parliament imposed a moratorium on new petroleum deals until new laws were in place.
The slow progress in enacting the oil laws is likely to slow development of key oil production infastructure, potentially causing Uganda to lose out on much needed revenues as well as tarnishing its investor-friendly image.
Last month two bills covering upstream and downstream sectors of the emerging hydrocarbons industry were brought back to the House for final debate and passage.
But the speaker, a member of President Yoweri Museveni's ruling party, sent parliament on a month-long recess after lawmakers insisted on amendments such as limits to the oil minister's powers and granting legislators greater oversight.
"There's a standoff with the executive because they want to control everything without people's representatives having a say," member of parliament Gerald Karuhanga told Reuters.
"We had anticipated these laws to be in place by the end of this year but this intransigence on the part of the executive might push us into next year and that will push further the timelines for any new licensing round."
Karuhanga said other amendments demanded by lawmakers included provisions that would allow parliament to scrutinise new oil deals before they were signed and to be able to vet candidates for senior management positions in the proposed national oil company and sector regulator.
Junior energy minister Peter Lokeris dismissed Karuhanga's accusations, although he acknowledged the passage of the legislation would take longer than originally anticipated.
"These debates going on are normal...they might delay things a little bit but we'll reach a common position with MPs and pass these laws," he said.
Energy officials had previously said they hoped the new laws would be passed this year to pave the way for a licensing round by early next year.
TRANSPARENCY
The laws are meant to guarantee transparency in the oil sector, provide for a clear management structure and institute environmental safety mechanisms.
Transparency watchdog Global Witness has criticised the proposed laws, saying they gave too much power to the executive and failed to guarantee disclosure of crucial information and weak environmental safeguards.
Analysts say Museveni, eager to guard Uganda's investor-friendly credentials, is likely to use strong-arm tactics to persuade his party's lawmakers, who form the majority in the chamber, to pass the laws.
Uganda discovered oil in its Albertine rift basin along the border with Democratic Republic of Congo (DRC). Reserves are estimated at 3.5 billion barrels although only 40 percent of the basin has been explored.
The delay might prove a headache for new oil companies keen to enter Uganda's nascent oil sector.
Both Total's Uganda unit and British explorer, Tullow Oil, told Reuters on Monday the delays would not have an impact on their current operations because they were covered by existing legal frameworks.
Source: http://news.yahoo.com/ugandas-planned-oil-laws-face-fresh-delay-lawmakers-053116482.html
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