Issue 12, November 2013 BLACK MONDAYNewsletter Citizen Action Against theft of our money without SHAME! EDITORIAL t a glance it is a no-brainer: A THEFT: The major country discovers oil, extracts it- Asince the world demand for oil is never-ending, starts scooping dollars, builds infrastructure, businesses start flowering, and standards of living im- prove dramatically. threat to oil benefits But wait a minute. If you take a closer look, oil-producing countries are not following identical trajecto- ries leading to prosperity – in fact there are many examples of oil lead- ing to poverty. There is another set of factors that determine if oil will benefit any given country, like legal frameworks, com- pliance to international agreements, business environment, labour force skills, infrastructure, social stability, ap- propriate economic mechanisms, trans- parency and corruption, and others. If you take the prime example of well-managed oil wealth, Norway, oil in itself did not lead to prosper- ity. Norway was a developed country even before they struck oil; and they had strong governance mechanisms in place before the oil started flow- ing. But then again, Norway is one of the least corrupt countries in the world. Or let’s take Nigeria. They are Africa’s leading oil producer, yet al- most half the population lives below the poverty line-in other words they are in a worse position than Uganda. Why? Because Nigeria is one of the Inside this issue >> world’s most corrupt countries. n the “Uganda Vision 2040”, the Nation- This is the ideal scenario, and one that al Planning Authority envisages a land most adult Ugandans who have slowly wit- This is the crossroads Uganda is Iof wealth and stability: 80 % of roads nessed basic social services crumble around at now. We can choose poverty or fully paved; all Ugandans living in planned them over the years, dream about. But a prosperity, but for the latter to mate- settlements, four international airports, high dream it may remain for them, if the gov- rialize, we need to install good gov- speed trains, world-class health facilities, ernment remains on its current trajectory, ernance, transparency, a legislation schools and a globally competitive agricul- where corruption, impunity and selfishness that is clear and fair, and ensure that tural sector. continue to prevail and the gap between the corruption and theft are eliminated. This modern world is seen possible be- haves and have-nots, the corrupt and in- 2 | Interview with Hon. cause the country will be earning several corrupt, selfish and selfless keeps growing Theodore Ssekikubo Yet what we have now is (weak billions of dollars from its oil every year. wider and wider. legislation, non-transparency, unfair On the face of it, it seems as simple as With the first barrel of oil for sale antici- 4 | Pictorial: Uganda at land evictions, etc) just making the that: the international oil companies extract pated sometime around 2018, the govern- the crossroads thieves richer while the rest of us suf- the crude oil, ship off some to the interna- ment seems to already be off to a very bad fer. tional markets, a fraction goes into the pro- start. 6 | NGOs working in oil posed refinery, earnings are shared accord- The recently passed petroleum laws have governance face closure In oil lies the opportunity to re-in- ing to the terms of the Production Sharing been criticized for neglecting the need for vent our social infrastructure, but let Agreements and the money earned is used parliamentary oversight in the oil and gas 7 | Injustice, confusion mar us evict the thieves first. to supplement other existing sources of rev- sector, instead providing for tight ministeri- compensation process enue to finance this grand Vision 2040. TURN TO PAGE 3 1 NOT FOR SALE Issue 12, November 2013 The bells of apprehension about the oil are already ringing Theodre Ssekikubo (Lwemiyaga County), together with Bugweri County MP Abdu Katuntu, Wilfred Niwagaba (Ndorwa East) and Gerald Karuhanga (Youth,Western) were some of the lawmakers behind the oil bribery allegations raised during a special sitting of Parliament in October 2011. Hon. Ssekikubo is currently the Chairman of the Parliamentary Forum for Oil and Gas [PFOG], a forum that continues to fight for the rights of Ugandans towards fair oil and gas benefits sharing. Below, we bring you an interview with his views about the current status, laws, institutions and what needs to be done to make it better. What is your general feeling about the cians are bound to be compromised by the oil discovery in Uganda? appointing authority whereas the Petroleum The Oil discovery spurred a lot of hope Authority is accountable to the citizens. Well, amongst Ugandans. Given the existing chal- the law (Exploration, Development and Pro- lenges like the high levels of poverty, poor in- duction Act 2013) in its current state shows frastructure and high levels of corruption this that the Authority plays a role of advising and discovery was timely and a blessing to the being consulted but all that isn’t mandatory- people of Uganda. At the crossroads, Uganda one can choose to take the advice or leave it. needed a new beginning and direction. As a country, we have been bedeviled by the high So, is all hope lost? levels of corruption, inefficient system of Of course, all hope is not lost. We never lost governance and institutions and so the bells of the battle completely. We brought the Nation- apprehension are already ringing. Given our al Oil Company whose leadership will be ap- background and the current state of affairs, it proved by Parliament having been appointed is still a high risk to applaud the oil discov- by the minister. The petroleum Authority has ery. been brought on board despite the challenges with its powers. There are other provisions like So, do you feel that since you lost the one that ensures that our environment is fully battle over Clause 9, Uganda’s oil and protected during the exploration process. gas sector is doomed-starting with the Besides, times change, I am sure once a stable law? government comes to power, there could be We had successfully passed Clause 9 whose an opportunity to amend the Bill and give essence was to give the negotiation and li- back the powers of control to the Authority. censing powers to the Petroleum Authority instead of the minister. Our issue was that the How can you explain President Musev- minister is a political person and therefore eni’s apparent efforts and insisting to could be influenced by the powers that be. give the Minister of Energy and Mineral As you know in the past, oil exploration Development total control over the oil deals with Neptune, Heritage and other and gas sector in Uganda? companies were concluded with the minister with- out the knowledge WHO IS THEODORE of Parliament and SSEKIKUBO? Ugandans in general. l Born on 20/08/1969 Politi- l Bachelor of Arts in social sci- ence and a Master in public ad- ministration and management; both from Makerere University. l Member of Parliament for Lwemiyaga County since 2001 to date. He belongs to the NRM (National Resistance Move- ment) l Member of Committee on De- fence and Internal Affairs l Chairperson Parliamentary Forum for Oil and Gas [PFOG] l One of the “rebel” MPs expelled from NRM l He worked as an assistant secre- tary/administrative officer and a lecturer 2 Issue 12, November 2013 The oil discovery was in the first place taken able Minister of Energy to think of the long stitutional court which ought to be a point of as a personal venture/business until we had a term future of Uganda. reference/arbitration that is playing politics not what IS IN the parliamentary session to discuss this matter. Although Uganda is a late entrant into the oil justice. PETROLEUM act? Of course, the president influenced the entire & gas industry compared to other countries, So, from the word go, the ad-hoc committee process of passing the bill that gave powers we can build on existing knowledge of global was doomed to fail. The then Minister of In- to the minister to grant and revoke licenses of best practices. How come oil is a blessing in ternal Affairs, Hilary Onek, refused to give l The Petroleum (Exploration, oil companies. You know that on 5th February some countries and a curse in others? We shall clearance for the committee to go and make Development and Production) Act, 2012, Tullow Oil signed an agreement with continue to be vigilant. references to Dubai, Malta, Germany and the 2013, provides for the establish- Total and CNOOC at Rwakitura. The President UK where money had been transacted. To me, ment of the Petroleum Authority of called the minister to sign the agreement yet a But there have been questions about the really this shows that the President isn’t com- Uganda, whose function will be to moratorium had been put by parliament to stop parliament itself being compromised by mitted to fighting graft. monitor and regulate exploration, this. This standing order from parliament stops the Executive? development and production of the president or the minister from signing any You see, Parliament is made up of people and In your view, how can Uganda manage petroleum in Uganda. agreements without the approval of parliament they come from the same community as all its oil and gas resources to ensure lasting but you can see what is happening already. So, other Ugandans. So if there is lack of integrity benefit for all Ugandans? Do you even l The Authority shall have a Board it shows you that he is the one in charge.