The Uganda National Oil firm (UNOC) has stated that it has recently created a firm in Kenya in order to comply with legislation governing the importation of petroleum products into the nation.
In a statement made on Monday, November 13, Sarah Birungi Banage, the UNOC head of corporate affairs, said that a certificate of incorporation granted in the nation of corporation, in this case Uganda, is what is required to register a branch in another country.
She pointed out that this is standard procedure for multinational corporations.
As a result, UNOC’s shareholders and board of directors, led by Emmanuel Katongole, remain unchanged, with control of activities in Uganda and Kenya.
“The Kenya branch is in connection with the Government’s strategic decision to enhance UNOC to source and supply the petroleum products to the licenced oil marketing companies,” he said.
She stated that the decision required a modification to the Petroleum Supply Act, 2003 via the Petroleum Supply (modification) Bill, 2023. The Bill has since been introduced in Parliament. The Environment and Natural Resources Committee of Parliament is looking into it.
“UNOC reaffirms its commitment to transparency, adherence to laws, and regulations, all while safeguarding the State’s commercial interests in the oil and gas sub-sector,” he said.
The Petroleum Supply Amendment Bill, 2023, which seeks to grant UNOC a monopoly in importing petroleum to Uganda, is being scrutinized by Parliament’s Natural Resources and Environment Committee.
Uganda aims to give over exclusive rights to a unit of global energy trader Vitol for the delivery of all petroleum products and stop a system that sources the oil products through neighboring Kenya, according to Uganda’s energy minister.
Ugandan fuel companies obtain their supply from associated corporations in Kenya, which import the commodity on their behalf through Mombasa port.
According to energy minister Ruth Nankabirwa, this arrangement, which accounts for 90% of Uganda’s fuel imports, exposes the country to supply interruptions and high pump prices.
“UNOC and Vitol Bahrain E.C. have negotiated a five-year contract, and the Partner (Vitol) will be financing the business by providing a working capital,” Nankabirwa stated in a press release.
According to Bank of Uganda figures, Uganda would import $1.6 billion in petroleum products in 2022. Cabinet approved revisions to the petroleum law that would allow Vitol to supply the state-owned UNOC solely.
The name of the UNOC corporation incorporated in Kenya had not yet been determined at the time of publication.
