June 25 (Reuters) – The discovery of oil in western Uganda has prompted a land grab around the oil fields, dispossessing impoverished local communities and providing a potential trigger for conflict, members of parliament from the area said on Friday.
East Africa’s third largest economy is basking in a fresh wave of economic vitality as global investors rush in to tap opportunities in its budding oil industry.
Commercial hydrocarbon deposits were discovered in the Albertine Rift Basin close to the country’s border with the Democratic Republic of Congo in 2006 and reserves are estimated at 2 billion barrels.
Member of parliament Stephen Biraahwa Mukitale told Reuters there was a rush by powerful and influential individuals to acquire large tracts of land in the area.
“Land in the whole of the Albertine Graben is mostly customarily owned but powerful individuals speculating on its value are trying to survey and register large chunks of it in their names,” he said.
“I have warned the government that this is a recipe for conflict. The government must formally and openly survey and demarcate land in the whole area and give titles to the communities.”
The scramble for land, he said, is consolidating ownership in a few individuals and could provoke landless and impoverished people in the region to sabotage oil exploration and production activity in future.
“The land that is being registered for freehold ownership has owners already, these are the local communities and you can’t guarantee what these people will do once they discover they no longer own the land,” he said.
Tomson Kyahurwenda, another legislator from the region, told Reuters the land grab could unsettle the region.
“People go to Kampala and acquire individual titles and you find one person with nearly ten titles and I think this is not only unacceptable but criminal,” he said.
“The government policy is that land in that area belongs to the communities,” Matia Kasaija, junior internal affairs minister, told Reuters. Kasaija did mention any possible government action against grabbers.
Tullow Oil (TLW.L), which has made the most discoveries in the region, expects to start limited commercial petroleum production in the last quarter of 2011. Daily crude output is forecast to peak at about 200,000 barrels by 2015.
Tullow is awaiting approval of its proposed purchase of Heritage Oil’s (HOIL.L) exploration assets in Uganda. Heritage is selling its half-share stakes in exploration areas 1 and 3A for a total of $1.5 billion.
Approval of the deal, though, has stalled over a tax dispute pitting Heritage against the Ugandan government. (Reporting by Elias Biryabarema; Editing by Giles Elgood)