An official from the office of the President of Uganda claimed that representatives of CNOOC Ltd. held talks with the Uganda government in early September on a future project led by Tullow Oil PLC (TLW.LN) , Dow Jones reported.
Another informant estimated CNOOC Ltd. and other companies would hold negotiations with UK-based TLW.LN. But spokesmen of CNOOC, TLW.LN and Ugandan Energy Ministry all declined to comment.
TLW.LN once made a major discovery in Lake Albert in the eastern part of Uganda. The company later expressed the hope to sell part of its stake in exchange for funding of the project.
An oil transmission pipeline of 1,300km ranging from Lake Albert to Mombasa, a port city of Kenya must be built for commercial production of the project. In addition, the Uganda government also hopes the operator to build a new refinery there. Industry experts estimate a total of 5-6 billion US dollars of investment may be needed for pipeline, refinery and extraction costs.
According to industry sources, besides CNOOC, China National Petroleum Corp. (CNPC) and China Petrochemical Corp (Sinopec) have also been entitled to the negotiation. However, it’s still unclear if they are competitive or cooperative.