Acode - Local Content

LOCAL CONTENT IN OIL AND GAS SECTOR
An Assessment of Uganda’s Legal and Policy Regimes
Peter Magelah Gwayaka
ACODE Policy Briefing Paper Series, No.28, 2014

LOCAL CONTENT IN OIL AND GAS SECTOR
An Assessment of Uganda’s Legal and Policy
Regimes
Peter Magelah Gwayaka
ACODE Policy Briefing Paper Series No.28, 2014

Published by ACODE
P.O. Box 29836, Kampala - UGANDA
Email: library@acode-u.org, acode@acode-u.org
Website: http://www.acode-u.org
Citation:
Magelah, P., G., (2014). Local Content in Oil and Gas Sector: An
Assessment of Uganda’s Legal and Policy Regimes. ACODE Policy Briefing
Paper Series, No.28, 2014. Kampala.
© ACODE 2014
All rights reserved. No part of this publication may be reproduced,

stored in a retrieval system, or transmitted in any form or by any means
– electronic, mechanical, photocopying, recording or otherwise without
prior permission of the publisher. ACODE policy work is supported by
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The reproduction or use of this publication for academic or charitable
purpose or for purposes of informing public policy is exempted from this
restriction.
ISBN 978 9970 34 031 6
Cover Photo:
An aerial view of an oil exploration facility in Buliisa district, Uganda.

Table of Contents
List of Acronyms.....................................................................................v
Acknowledgement.................................................................................. vi
1. Introduction....................................................................................... 1
1.1 Study Objectives.................................................................................... 2
1.2 Study Scope.......................................................................................... 3
2. Local Content Vs Citizen Participation in Uganda................................ 3

3. Oil and Gas Local Content in Uganda.................................................. 5
3.1 Training and Capacity Building for Citizens............................................ 6
3.2 Uganda’s Capacity Needs for the Oil and Gas Sector.............................. 8
3.3 BTVET Training for Oil and Gas in Uganda.............................................. 9
3.4 Local Content and Procurement from Ugandan Suppliers..................... 11
3.5 What Constitutes a Local Business Entity of Local Supplier?................. 12
3.6 What Parameters Should be Used to Determine a Local Company/

Business Entity?................................................................................. 13
3.7 Treatment Of “Ugandan Company” by Other Laws in Uganda............... 14
3.8 What Should be the Relationship Between the Local Supplier and Other
International Businesses Operating in the Country?............................ 16
4. Determination of Local Content, Experiences from the Other

Institutions and Countries............................................................... 19
5. Policy Recommendations for Uganda................................................ 24
References........................................................................................... 26
Publications in this Series.................................................................... 28
Local Content in Oil and Gas: Legal and Policy Issues in Uganda
List of Acronyms
ACODE Action Coalition for Development and Environment

AfDB African Development Bank
BTVET Business, Technical and Vocational Education and Training
CNOOC China National Offshore Oil Company
CSR Corporate Social Responsibility
GoU Government of Uganda
JV Joint Ventures
MoEMD Ministry of Energy and Mineral Development
MoES Ministry of Education and Sports
NOGP National Oil and Gas Policy
NVTI Nakawa Vocational Training Institute
OECD Organisation for Economic Co-operation and Development
Organisation for Economic Co-operation and Development
PAU Petroleum Authority of Uganda
SCC Sector Skills Council
TVET Technical, Vocational Education and Training
UPC Uganda Polytechnic Institute
UPIK Uganda Petroleum Institute, Kigumba
UTC Uganda Technical Institute
WB World Bank
v
Acknowledgements
The year 2014 marks 8 years since Uganda announced the existence of
commercially viable petroleum deposits. Since this announcement in
2006 a lot of efforts have gone in the making of laws and policies that will
govern the sector and see to it that the country maximises the benefits of
exploiting its oil and gas reserves. One major concern for government, the
citizens and all the actors has been how Ugandans will benefit from the
oil and gas sector. Concerns have been raised on whether the sector can
provide employment for citizens, use locally produced goods and services
as well as exploit local resources to transfer technology that can kickstart
other sectors of the economy. The debate has tended to be around local
content and how much local content will be utilised by the sector.
On the other hand the debate has been on whether there is enough local
capacity to deal with the employment, technology and service needs for
the oil and gas industry. Questions have also been raised on standards
of locally provided goods and services and whether they can meet the
demands of the industry. On overall there is an agreement that the oil and
gas industry should involve Ugandans and should in as much as possible
employ Ugandans and Ugandan goods and services. What seems to be a
disparity is whether Uganda has capacity to provide the goods, services
and skills necessary for the sector.
This policy brief assesses the legal and policy approaches so far adopted
in ensuring the participation of Ugandans in the oil and gas sector. The
brief assesses the standards set in the Oil and Gas Policy, 2008, the
Petroleum (Exploration, Development and Production) Act, 2013 and
Petroleum (Refining, Conversion, Transmission and Midstream Storage)
Act, 2013 which are the major instruments governing the petroleum
sector in Uganda. The brief also looks at standards and approaches
adopted by other countries in Africa and major commercial institutions.
The brief highlights the major gaps in the laws and policies and makes
key recommendations to address the gaps.
I would like to thank the staff of ACODE in particular Onesmus Mugyenyi,

Dr. Author Beinomugisha and Dr. Winstons Muhwezi for their comments
and guidance on the earlier drafts of this paper. Special thanks to the
editor for the valuable changes and additions to this paper.
vi Local Content in Oil and Gas: Legal and Policy Issues in Uganda
1. Introduction
Many countries engaged in oil and gas production or mining are
introducing requirements for participation commonly referred
to as ‘local content’. This is increasingly so in the developing
world mainly in Africa, Asia and Latin America. Local content
requirements are mainly in form of policy and regulatory
measures that focus at increasing use of the locally available
labour, technology and other resources in the oil and gas sector.
The focus is on transfer of technology by companies engaged in
the extractive resource sector to the native people of a particular
nation with a hope of assuring them income, employment and
ultimately sustainable development. The development of local
content has basically been a result of recognition that after years
of oil and gas or mineral exploitation in many developing countries,
little seems to be transferred to the citizens of these resource-rich
countries in form of technology and employment1. Many citizens
of resource-rich countries especially in the developing world tend
to be mere spectators. This trend continues to exist in spite of the
fact that many mining and petroleum companies in the developing
world are given incentives such as tax holidays with a hope that
they will be able to exploit the resource, provide employment for
the natives and develop infrastructure which would enable the
economy to develop.
Uganda is not exception to the observation that many citizens

of resource-rich countries especially in the developing world are
mere spectators. After the announcement of commercially viable
quantities of petroleum in the country, there was excitement about
the developments the new resource would bring. Ugandans have
been excited at the potential for development, improvement of
household incomes and general living standards once petroleum
revenues start flowing. However, it is not always as rosy as it looks.
Uganda will need stringent macro and micro economic policies to
enable the economy sustain the negative impacts that petroleum
might have on the economy2. The need to fight the mismanagement
of the oil resource that has been characteristic of most oil
1 Peter Matthews and Matthew Lynch (2011) Local content strategy: A guidance document for
the oil and gas industry. IPIECA. London
2 Muhwezi, et.al, (2009). Crafting an Oil Revenue-Sharing Mechanism for Uganda: A
Comparative Analysis. ACODE Policy Research Series, No. 30, 2009. Kampala.
1
producing countries in the developing world is of paramount
importance. It is necessary to have in place measures to avoid
the “Dutch disease”3 and the resource curse such as conflicts4.
Many scholars have argued that the ‘Dutch disease’ and resource
conflicts are basically a result of poor management of resources
in the country. The failure to exploit resources sustainably and
enable citizens take part in decision making and employment
greatly contributes to conflicts emanating from natural resource
endowments. Economic challenges such as the Dutch disease are
a result of failing to link natural resource exploitation with other
sectors of the economy like agriculture, tourism and industrial
development The lack of involvement of citizens in the exploitation
and use of the natural resources sector greatly hinders the
trickledown effect of a resource like oil consequently resulting in
negative effects to the economy.
Uganda government has in place the National Oil and Gas Policy
(NOGP). Secondly, the country has in place the upstream and
midstream laws to govern and regulate the oil and gas sectors
but the downstream bill is still being considered by parliament.
It is important for these laws and policies to provide for citizen
participation and safeguard citizens roles in the oil and gas sector.
1.1 Study Objectives

a. To review the legal and policy regimes on local content
in Uganda, highlight gaps in the existing legal and policy
regimes and recommend areas of reform
b. To highlight lessons learnt in local content regulation from
countries dealing with extractives in Africa and elsewhere
so as to be able to recommend for approaches that can
be adopted to improve Uganda’s local content and citizen
participation policies in the oil and gas sector.
3 The “Dutch Disease” is a term used to describe an economic situation faced by many resource
rich developing countries. The term is used to describe a situation where production and
export of natural resources such as Oil and Gas or Minerals results into economic situation
other exports from the country become less desirable which results in slowing down other
sectors of the economy and over dependency on the particular resource. This in the end
exposes the economy to negative forces of the sector (e.g. oil price fluctuation, “dying” of
other sectors like agriculture and industry) and later affects economic development.
4 Collier, P. 2010. The Political Economy of Natural Resources. Social Research, 77(4):1105-1132.
2 Local Content in Oil and Gas: Legal and Policy Issues in Uganda
c. To recommend key actions and reforms Uganda needs to
take up to have an effective local content policy, legal and
institutional regime.
1.2 Study scope

This study is limited to legal, policy and institutional reviews of
local content in the oil and gas industry in Uganda. It basically
reviews the existing laws and policies as well as institutions to
support local content and local content development in Uganda.
The study also borrows on experience from other countries in
relation to how those countries have treated local content issues
in their laws.
2. Local Content Vs Citizen

Participation in Uganda
Citizen participation in oil and gas sector has become a slogan
of sorts across many countries in Africa. Different countries
have made laws and policies to provide for local content where
citizens can be employed, provide services or get a direct benefit
from the sector. However what many countries have not done is
to increase citizen participation. There is often confusion when
it comes to discussion of citizen participation as a concept and
issues of local content. Whereas citizens can participate through
local content, this is rather one of the forms of participation and
it is not conclusive. It would therefore be wrong to conclude that
there is citizen participation just because you have local content
law and policies. Basically, citizen participation involves processes
that provide for individuals in a community an opportunity to
influence public decisions that affect them5. The definition can
further be extended to include the process in which ordinary
people take part – whether on a voluntary or obligatory basis
and whether acting alone or as part of a group – with the goal of
influencing a decision involving significant choices that will affect
their community6. Citizen participation involves a wide range of
5 Cogan, A. , Sharpe, S. , & Hertzberg, J. (1986). Citizen participation. In So, F. S. , Hand, I. , &
Madowell, B. D. (Eds.), The Practice of State and Regional Planning. Municipal Management
Series. Chicago: American Planning Association.
6 André, P. et al. (2006). Participation publique: principles internationaux pour une meilleure
pratique, Publication spéciale, Série no. 4, Fargo (ND): International Association for Impact
3
activities and systems that ensure views of an individual citizen
are included in decision making processes.
The term “citizen participation” involves two important items

namely; the ‘citizens’ and ‘participation’. Used in strict sense
“citizen participation” would mean only citizens of a country take
part in decision-making. However this is not always the case since
there are other persons not necessarily citizens of a country that
are entitled to take part in decision making. Different scholars
tend to suggest that citizen participation should look at benefits
accruing to those most in need and moving away from the legal
definitions of citizenship7 For example, “citizen participation” has
been described by Cunningham J. to focus on (a) members of
the community who have no formal source of power except their
majority numbers (the ordinary person in society), (b) exercise of
power by those at a lower level of the community (power relations
between the led and the leaders) and making decisions involving a
significant number of community members8 . Some scholars have
argued that this should focus on getting local ownership of projects
and other forms of interventions through increased participation
by residents (as opposed to citizens)9 . In simple terms, citizen
participation involves power relations between members of a
community and their leaders and the ability of that community
irrespective of where it is located to take part in decisions and
activities that affect them.
Participation on the other hand involves taking part in processes

that lead to the decision or taking part in arriving at the decision
itself10 . This does not mean the individual’s views have been taken
Assessment. Available at http://www.dictionnaire.enap.ca/dictionnaire/docs/definitions/

definitions_anglais/citizen_participation.pdf
7 Thomas Webler (1995) “Right” Discourse in Citizen Participation: An Evaluative Yardstick.
Technology, Risk, and Society Volume 10, 1995, pp 35-86. Also See Cogan A (ibid) and
Cunningham J. V (ibid)
8 Cunningham, J. V. (1972). “Citizen Participation in Public Affairs,” Public Administration
Review, vol. 32, Special Issue: Curriculum Essays on Citizens, Politics, and Administration in
Urban Neighbourhoods, pp. 589-602.
9 André, P. et al. Ibid also see Rowe, G. and L. J. Frewer (2005). “A Typology of Public
Engagement Mechanisms,” Science, Technology, & Human Values, vol. 30, no. 2, pp. 251-290.
10 OECD (Organisation for Economic Co-operation and Development). 2001. Citizens as Partners:
OECD Handbook on Information, Consultation and Public Participation in Policy-Making. Paris:
OECD. Tina Nabatchi (2012) A Manager’s Guide to Evaluating Citizen Participation. Fostering
Transparency and Democracy Series 2012. Available at http://unpan1.un.org/intradoc/
groups/public/documents/UN-DPADM/UNPAN048340.pdf accessed on 14th July 2014
up but rather the individual’s views were considered in the process
of arriving at a decision. Such a kind of participation can be direct
for instance, taking part in an election or being part of a meeting
that arrived at a decision or indirect through a representative.
This can range from national or regional representation such as
parliament to representation at a lower level such as village council
or family11.
From the above definitions, it is important to appreciate that citizen

participation is a much broader concept that may include various
democratic processes for a country. In Uganda’s case, these
may include a wide range of systems from electoral democracy,
governance such as central or local government to group formation,
role of voluntary associations and how different players in society
are contributing to the oil and gas sector.
It is important to note that there is a tendency to mix ‘local content’

and ‘citizen participation’ in Uganda. A lot of communication tends
to claim that there is promotion of citizen participation through
local content, which is not the case. Many times, local content
limits itself to employment of citizens, transfer of technology
and service provision leavening out the most important aspect of
citizen participation which is ‘participation in decision making’.
From the many policy and legal documents in Uganda, there is
actually local content as opposed to citizen participation. This
paper focuses on local content in Uganda’s oil and gas sector as
opposed to citizen participation.
3. Oil and Gas Local Content

in Uganda
Local content in the oil and gas sector in Uganda broadly focuses
on involving citizens in the sector. This is through training and
building capacity for citizens, technology transfer, employment
and service provision. Given the fact that Uganda’s oil and gas
sector is still growing, there is need for exerting more deliberate
efforts to ensure that citizens competitively take part in the sector
11 Tina Nabatchi (2012) A Manager’s Guide to Evaluating Citizen Participation. Fostering
Transparency and Democracy Series 2012. Available at http://unpan1.un.org/intradoc/
groups/public/documents/UN-DPADM/UNPAN048340.pdf accessed on 14th July 2014
5
through exploitation of the existing opportunities. One of the ways
has been through government providing for Ugandans to take
part is the sector is through local content. Government is in the
process of making policies and laws that will ensure citizens take
part in the oil and gas sector. This policy briefing paper tackles
the present but is also futuristic and analyses the different policy
and legal provisions and how they will contribute to delineation of
local content in the oil and gas sector as well as identifying gaps
that need to be addressed.
3.1 Training and Capacity Building for Citizens

Participation of citizens in the oil and gas sector will require
capacity building and training of citizens to work in the sector.
Training needs to focus on building capacity for direct employment
in the sector and for services auxiliary to the sector. There is also
need to build capacity for other sectors to avoid reliance on the
oil and gas sector.
The NOGP recognises the need for national participation through

employment, training and skills development and service provision
in the sector. Under objective 7 of the NOGP; government seeks
to ensure optimum national participation in oil and gas activities.
Similarly, objective 8 of the NOGP seeks to support strategies for
development and maintenance of national expertise in the oil and
gas sector. Some of the strategies government intends to use to
achieve the above objectives include
(a) Promotion of state participation in Production Sharing

Agreements with a view of providing better opportunities for
the state to understand the basis for decisions in exploration,
development and production, together with acquiring the
skills necessary for commercial management of the sector.
(b) Promotion of public private partnerships whose benefits
outweigh their cost, and whose costs and benefits are
mutually and fairly shared by the partners.
(c) Encourage civil society to participate in the building of a
productive, vibrant and transparent oil and gas sector.
(d) Promotion of employment of Ugandans in the oil and gas
sector and
(e) Promotion of transfer of skills and technology to the country.
(f) Identifying training skills required for the sector and planning
for their development through both formal and industrial
training.
(g) Utilising oil and gas activities in the country to support
provision of the necessary training.
(h) Provide appropriate training to Government personnel in the
relevant fields as one of the ways to facilitate professional
dialogue with oil companies.
(i) Broaden the national education curricula to prepare the
necessary workforce for the growing oil and gas sector in the
country.
To give the above strategies the force of law, the Petroleum
(Exploration and Development) Act, 201312 (upstream law) and
the Petroleum (Refining, Conversion, Transmission and Midstream
Storage) Act13 (Midstream law) provide for training and employment
of Ugandans. The two laws make it a requirement for companies
to provide a plan for training and employment of Ugandans in the
sector during application for licences. Generally, it is presumed
that the plan to train Ugandans is one of the conditions for which
a licence can be granted. However there is no clear strategy to
ensure that the companies are followed-up to ensure they train
Ugandans as proposed in their applications.
The Upstream and Midstream laws also require companies to

submit to the Petroleum Authority a detailed programme for
recruitment and training of Ugandans every year for approval.
What is not clear from the law is how the approved plans for
training Ugandans will be followed through and whether there are
any forms of punishment for companies that fail to meet their
obligations under the approved plan or the plan submitted during
the application for a licence.
12 Act 3 of 2013
13 Act 4 of 2013
7
Whereas the foregoing programs and strategies for training
Ugandans are good for capacity building, there is need to
reform Uganda’s education sector to meet the demands for the
industry. For example, there are no systems to determine what
kind of capacity is needed for the sector and whether the training
programs submitted by oil companies will meet these capacity
needs at present. There is no link between the Petroleum Authority
which is the main regulatory agency and the Ministry of Education
and Sports and The National Curriculum Development Centre to
develop training content that will enable Ugandans take part in
the sector.
At present there is no proper system or institution charged with

vetting the kind of training Ugandans need in relation to oil and
gas. Most of the training is based on individual institutional choice
of training programs. There are also no mechanisms for directing
company scholarships to building skills that relate to the industry.
3.2 Uganda’s Capacity Needs for the Oil and Gas Sector
Government has not done Training Needs Assessment or other
forms of capacity needs assessment for the oil and gas sector and
the only existing data is the study conducted by the joint partners14
involved in the oil and gas sector. This means Uganda will have to
rely on data provided by industrial players. The challenge with this
data is it was gathered and analysed in the lenses of an industrial
player seeking to maximise profits and this may not necessarily
reflect the needs of the country.
The industrial survey data reveals that the Oil and Gas sector will
employ 13,000 people in the construction phase (within 3 to 5
years), this will drop to 3,000 people in the operational phase (20-
30 years). Out of this manpower required 15% will be engineers
and managers, 60% will be technicians and craftspersons and 25%
will be unskilled workers15 . The industrial survey recommends that
focus in education should be put on civil constriction, electrical
and mechanical fields.
14 These include Tullow Oil, CNOOC and Total Ltd who have active licenses in Uganda today
15 See CNOOC, Total and Tullow (2014) Planning for the future and promoting national content: A
survey to foster opportunities for Ugandans in the Oil and Gas sector
The industrial survey indicates that existing capacity gaps in
the sector such as limited qualified civil craftspersons, drivers,
mechanical technicians among others. The survey expresses fear
that some areas such as welders and electrical technicians could
be “dried out” depriving them of other sectors.
On the other hand a total of 100,000 indirect jobs will be created

by the sector. These will be involved in a wide range of activities
that have direct or indirect support to the sector ranging from
agriculture, textiles, road construction, and information technology
among others.
From the findings of the industrial survey, the following standout

as key issues needing action for local content;
1. The need to develop capacity in the technical and engineering

areas
2. The need for certification for those trained to get international
recognition
3. The need to focus on other sectors that support the industry
From the industry survey it is clear that technical training for
Ugandans will be an important aspect of capacity building for
persons to take part in the oil and gas sector.
3.3 BTVET Training for Oil and Gas in Uganda

The BTVET policy and Strategic Plan 2011-2020 provides for
skilling Uganda with a special focus on the oil and gas sector. The
Strategic Plan is drawn from the draft BTVET Policy that sets out to
develop demand-responsive, employable skills and competencies
relevant to the labour market needs for Uganda. BTVET training
in Uganda is supposed to be achieved through creation of centres
of excellence within the petroleum sector targeted at the apparent
skills gaps. Because of the gaps in the BTVET policy and strategic
plan, Cabinet is considering a proposed Skilling Uganda Technical,
Vocational Education and Training (TVET) Reform Policy. The
reform policy seeks to provide and enable technical institutes and
polytechnic colleges provide tailored vocational training based
on industrial needs and the needs of specific sectors. At present
9
this is not possible since all training institutes have to follow a
curriculum approved by Ministry of Education and Sports (MoES)
and the Curriculum Development Centre
There have been attempts to reform BTVET training in Uganda

to focus on oil and gas. Government has introduced courses at
university and tertiary level16 with former Cooperative Institute
getting transformed into Petroleum Institute17. On top of these,
there are several private institutions offering courses in petroleum
ranging from law, finance, and economics, among others.
The Uganda Petroleum Institute, Kigumba (UPIK) was created as

a response to the various capacity need for the oil and gas sector.
UPIK is expected to train Ugandans in the different skills to be
able to provide labour for the oil and gas sector.
According to UPIK’s strategic plan 2014-19, a Sector Skills Council

(SCC) consisting of sector players for the oil and gas sector will be
created, the SCC will be mandated in assisting UPIK in reviewing
different courses and curricula to modify and fit them to the sector
needs and demands18.
Presently there is debate on the location of UPIK, whereas UPIK

is presently located within the Ministry of Education and Sports
(MoES), the feeling is that the institute together with other
related institutes should be located in the ministry responsible
for petroleum and be under the direct control of the Petroleum
Authority of Uganda (PAU) to be able to provide sector driven
courses and skills and provide oversight and feedback on the
quality of products from the training institutes19.
On the other hand the capacity needs for the oil and gas training
institutions needs to be reviewed. At present government has not
16 Makerere University, the biggest government University introduced courses in Petroleum

Geosciences while Makerere Business School introduced business courses targeting oil and gas
sector.
17 Kigumba was transformed from a cooperatives college to a petroleum institute by the
Universities and Tertiary Institutions (Establishment of Uganda Petroleum Institute, Kigumba)
statutory instrument, 2011, SI No. 31 of 2011
18 UPIK (2014) Institute Development Plan, 2014-2019
19 Ibid
reviewed the capacity of technical institutions which will provide
training for oil and gas sector jobs. Whereas instructors at UPIK
and Nakawa Vocational Training Institute (NVTI) have had some
basic training for the oil and gas sector, the same cannot be said
of other technical colleges. This will greatly undermine the nature
of skills imparted by these institutions.
At present UPIK is able to graduate about 200 students in a year,

this is a small number compared to the 10,000 or more qualified
personnel that will be needed for the construction phases. There
are plans to have other technical institutes incorporated in the
oil and gas sector, however efforts seems to be focused on only
Uganda Technical Institute (UTC) Kicwamba and NVTI, however
these need to be brought on board before the construction phase
begins.
It should be noted that by design UPIK focuses on providing

skills for direct employment in the oil and gas sector and may
not necessarily focus on other support sectors. However, there
is need to link BTVET training with direct and indirect services
to the oil and gas sector. For example, BTVET training needs to
focus on other sectors like textiles industry, road construction,
mining and agriculture among others. This will ensure the support
sectors provide goods and services that are competitive for the
oil and gas sector.
3.4 Local Content and Procurement from Ugandan

Suppliers
One of the approaches proposed under Uganda’s petroleum
policies and laws is procurement of goods and services from
Ugandan suppliers. The Ugandan suppliers mean Ugandan citizens
(or residents) as well as business entities. What actually amounts
to a Ugandan local supplier is still conceptually problematic. The
upstream and downstream laws provide different definitions, but
also broadly the question of how local should the local entity be
remains to be answered. For Uganda’s case, the following questions
need to be answered:
11
a. What should constitute “local” business entity or a local
supplier?
b. What parameters should be used to determine a local
company/business entity?
c. What should be the relationship between the local supplier
and other international businesses operating in the country?
d. What level of control should citizens have over the foreign
suppliers/businesses operating in the country (for example is
employing citizens or having citizens as shareholders enough
to qualify someone)?
There is an attempt to answer the above questions in Uganda’s
petroleum policy and the laws. However, several gaps exist.
3.5 What Constitutes a Local Business Entity of Local

Supplier?
When it comes to who a local supplier is in Uganda, the upstream
and midstream laws provide more confusion than answers! For
example, the Petroleum (Exploration, Development and Production)
Act provides under S. 125 that:
(1)The licensee, its contractors and subcontractors shall

give preference to goods which are produced or available in
Uganda and services which are rendered by Ugandan citizens
and companies.
(2) Where the goods and services required by the contactor or

licensee are not available in Uganda, they shall be provided
by a company which has entered into a joint venture with a
Ugandan company provided that the Ugandan company has a
share capital of at least forty eight percent in the joint venture.
The law does not define what a “Ugandan” company is, thereby
leaving a gap for exploitation. The strict interpretation of the word
“Company” used in the section instead of “business entity” limits
the application of this section only to companies living out other
recognised business entities such as partnerships, cooperative
societies, and sole proprietorships among others. The Midstream
Act, attempts to address this gap, (though not conclusively) by
providing that20
The licensee, its contractors and subcontractors shall give priority

to citizens of Uganda and registered entities owned by Ugandans
in the provision of goods and services.
Emphasis is placed on “registered entities” as opposed to

“companies”. This means other business entities are considered
under the midstream law as opposed to the upstream law that
restricts itself to companies. However, the use of the word
“registered entities” does not solve the problem because there
are situations where foreigners register business entities in a
country and this does not make such entities local entities. For
example S. 252 of the Companies Act21 mandates all companies
incorporated outside Uganda with businesses in Uganda to
register with the Registrar of Companies as a pre-condition to
operating in Uganda. Basically the companies Act on this aspect
tries to separate “incorporation” from “registration”. The former
is a process of forming a company and while the latter is a mere
administrative requirement.
On the other hand using the place of incorporation as a

determinant of a Ugandan company without proper restrictions
would also leave out citizens by allowing foreigners to register/
incorporate companies in Uganda which would qualify as Ugandan
companies. It is also not clear how the law will treat a company
registered outside Uganda by Ugandan citizens.
3.6 What Parameters Should be Used to Determine a

Local Company/Business Entity?
The debate in Uganda for service providers in the petroleum sector
and local content has focused on local companies and the question
of how ‘local’ a local company should be. Many commentators
on petroleum producing areas would love to see priority given to
companies operated or owned by persons hailing from areas where
20 S. 53(1) Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act

21 Act No. 1 of 2012
13
the petroleum resources are found while others believe petroleum
being a resource for the nation, any citizen should take part.
The upstream law provides for affirmative action in training,

employment and transfer of technology for Ugandan citizens in
favour of host communities. However, there is no affirmative action
when it comes to provision of services22.
The reasons for not providing affirmative action for host

communities when it comes to service provision is mainly because
there may be no local businesses capable to compete favourably
in the oil and gas sector and yet these could be available at the
national level. The fact that petroleum is a national resource means
that all Ugandans should be given a chance to benefit from the
resource.
3.7 Treatment of “Ugandan Company” by Other Laws in

Uganda
Uganda’s Companies Act23 does not define a Ugandan company,
it only provides for a definition of a company which provides that
a company means an entity formed and registered under this
law. Under S. 251 it describes a foreign company as a company
incorporated outside Uganda which runs business in Uganda.
Focus here is on place of incorporating, this may not cater for all
scenarios that may need to be addressed under local content, for
example a company incorporated by Ugandans outside Uganda will
be considered a foreign company and a company incorporated in
Uganda by non-Ugandans will be considered a Ugandan company.
The Uganda Investment Code Act24 on the other hand defines a

foreign investor as:
(a) a person who is not a citizen of Uganda;
22 S. 126(s) of upstream Act provides the programme submitted by licensee shall provide for the
training and recruitment of Ugandans in all phases of petroleum activities and shall take into
account gender, equity, persons with disabilities and host communities.
23 Act No. 1 of 2012
24 Uganda Investment Code Act, Cap 92 Laws of Uganda
(b) a company, which more than 50 percent of the shares are
held by a person who is not a citizen of Uganda;
(c) a partnership in which the majority of partners are not
citizens of Uganda25.
The Investment Code Act goes ahead to provide that the definition
of a foreign company shall not inclide a company is registered
under the Companies Act in which government is a majority
shareholder directly or indirectly or a corporate body established
in Uganda by law, a cooperative society and an international
development agency.
From the definition of this Act, a foreign company is determined

by the citizenship of its majority shareholders. Similar definitions
are given by the Land Act in determining a non-citizen for purposes
of owning land in Uganda. It provides that;
A non-citizen means:
(a) a person who is not a citizen of Uganda as defined by the
Constitution and the Uganda Citizenship Act;
(b) in the case of a corporate body, a corporate body in which
the controlling interest lies with noncitizens;
(c) in the case of bodies where shares are not applicable, where
the body’s decision making lies with noncitizens;
(d) a company in which the shares are held in trust for noncitizens;
(e) a company incorporated in Uganda whose articles of
association do not contain a provision restricting transfer or
issue of shares to noncitizens26.
The Land Act describes “controlling interest” in a company to
include:
(a) in the case of companies with shares, the majority shares

are held by persons who are not citizens; and
(b) in the case of companies without shares, a company in which
decisions are arrived at by the majority who are not citizens.
25 S. 9 Uganda Investment Code Act

26 S. 40 of the Land Act, Cap 224 Laws of Uganda
15
From the above it is clear that when it comes to land matters,
the law looks at interests and benefits in determining a Ugandan
or foreign company. Unlike the other laws, the Land Act has a
more strict definition of a foreign company in as far as it limits
a Ugandan company to only that entity whose majority decisions
are made by Ugandans or where the company specifically limits
its ownership to Ugandans in the Articles and Memorandum of
Association.
Looking at the above laws on can say that the different laws in
Uganda have provided for different definitions of Ugandan or
foreign companies based on the objects that such laws intends
to achieve. For example the intention of the Investment Code is
to provide for favourable conditions for foreign investors investing
in Uganda, such interests maybe very different from the interests
set a law providing for local content where the interest would be
ensuring more Ugandans participate in the sector despite the fact
that the investment and capital might be by a foreign company.
3.8 What Should be the Relationship Between the

Local Supplier and Other International Businesses
Operating in the Country?
The question of the relationship between local suppliers and
international businesses arises from the capacity and expertise
of local companies to work in the industry. Generally, whereas the
NOGP recognises the role of national companies and businesses
and the need to develop their capacity to take part in the sector,
there are great gaps when it comes to implementing the policy.
The Upstream and Midstream laws provisions create major
challenges on how Ugandans can take part. Uganda’s laws make
it mandatory for foreign companies to enter into joint ventures
with Ugandan businesses to be able to provide goods and services
for the sector. Joint Ventures (JVs) in the world have proven to be
some of the best ways through which international companies
can expand their sphere of influence through working with local
companies. JVs are also important when it comes to technology
transfer and skills development for countries that may not have
the technology. However, the businesses in countries where JVs
are to be developed need to have a certain level of knowledge,
skill and capital to be able to run the JVs. Uganda’s businesses
are starting to get involved in the oil and gas sector and this may
hinder their ability to effectively exploit the JVs.
When it comes to products or services that cannot be easily

procured on the Ugandan market or supplied by Ugandan
businesses, the two laws provide for joint ventures as a mode
of operation between the Ugandan businesses and the foreign
suppliers. However, the drafting in the two laws makes it easy to
abuse the provisions and to leave out Ugandan companies. For
example S. 53(3) of the midstream law provides that
The licensee, and the contractors and subcontractors of the

licensees shall give priority to the purchase of local products and
services from Ugandans wherever they are competitive in terms
of quality and timely availability.
The foregoing provision mandates the oil company to procure

from Ugandans only if they are competitive in terms of quality
and timely supply. As earlier noted, the capacity of many Ugandan
businesses needs to be developed since they have not been involved
in the sector. This means that, Ugandan businesses are unlikely to
compete better than the foreign companies nor can they have the
services readily available. This is likely to leave out many Ugandan
businesses in the sector.
The two laws provide for joint venture agreements for Ugandans
to take part in the sector. However, the nature of joint ventures is
not clear. For example, the Upstream Act provides that:
Where the goods and services required by the contactor or licensee

are not available in Uganda, they shall be provided by a company
which has entered into a joint venture with a Ugandan company
provided that the Ugandan company has a share capital of at least
forty eight percent in the joint venture27.
Whereas as the Upstream Act mandates Ugandan and foreign

businesses supplying goods and services in the oil and gas industry
27 S. 125(2) Petroleum (Exploration, Development and Production) Act
17
to have a mandatory joint venture company in which Ugandan
companies own a 48% stake, the midstream law is silent on this.
It provides
Where the goods and services are not available in Uganda, they
shall, where possible, be provided by a company which has entered
into a joint venture with a Ugandan company28.
From the above, it is not clear what amount of stake Ugandan

businesses should own in the new joint venture to supply goods
or services for the midstream sector in oil and gas. Whereas the
requirement to have Ugandan businesses owning 48% of share
capital is good for the country, the challenge will be in the capital
and other technical requirements to enter into such JVs. Some
aspects of the oil and gas sector require extensive capital and
many Ugandan businesses may not be able to provide such capital.
Besides, there is a requirement for technology which may not be
easily provided by Ugandan companies. This normally results into
challenges in operating the JV. Research has found that partners
contributing less to the JVs are less committed to the success of
the project since their role is limited29. This might create several
“lazy” Ugandan businesses entering the industry through JVs and
legal protection. The other aspect is the fact that ownership of
stake in a JV company should be comparable to what the other
party is contributing. The question here will be whether Ugandan
companies are able to provide 48% capital or skill or technology
to the specific JV companies they enter into.
Government and private players in Uganda need to build capacity

and capital to be able to effectively play a role in the industry.
The present legal protection for Ugandan companies may not be
enough to deliver results in the oil and gas industry. The alternative
is there is need to have particular services and goods ring-fenced
to be supplied only by Ugandan business entities and those which
cannot be supplied, can be left for foreign companies subject to
periodic reviews. This will ensure smooth transition from foreign
owned businesses to fully Ugandan controlled businesses after
the transfer of technological and capital.
28 S. 53(4) Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act

29 Beamish P. (1988) multinational joint ventures in developing countries. London Routledge
4. Determination of Local
Content, Experiences from the
Other Institutions and
Countries
A major challenge with the joint venture suggested under Uganda’s
petroleum laws is the requirement for the businesses entering into
joint venture to have same or similar capacities with the foreign
companies. The capacities needed here will basically be the need
to provide capital, skills and knowledge as well as technology. The
fact that most of the skills and technology will be provided by
foreign companies makes it easy to have joint venture companies
where Ugandan companies are merely fronted for the sake of
winning the tender and the actual work and control of business
is done by foreign companies with experience.
It is important to note that the trend across Africa and several other
developing countries has been developing specified policies, laws
and institutions for managing local content issues for oil and gas
or mining sector. Having such arrangements is aimed at ensuring
the local content requirements are properly implemented in the
extractives sector. A similar trend has been adopted by financial
institutions including the World Bank in determining the local
participation in oil, gas or mining sectors. Below is a summary
of how different institutions and countries have handled the issue
of local content
World Bank
The World Bank does not have specific provisions for local content.
However, it provides guidance for local procurement. Local
procurement here is determined based on three major pillars30
i. Level of participation of citizens in the company. This is

mainly across ownership, management and employment.
Local companies are judged based on who owns the company,
30 See World Bank (January 2012) Increasing Local Procurement By the Mining Industry in West
Africa. Report No. 66585-AFR
19
its management (control of the company) and the number
of citizens employed in the company
ii. The level of value addition. This is based on amount of local
input in the product. This is based on use of local materials,
local technology or local human resource in the making of
the product. This test focuses on the real contribution of the
product to the economy in terms of use of local resources,
employment and technology.
iii. Whether a product is manufactured locally, or a service is
delivered locally. This focuses on the geographical location
of the company. Preference is given to companies located in
the country or in the region. Sometimes, this also deals with
the local location of the company. Companies located within
the local vicinity of the petroleum or mining establishment
are given priority.
African Development Bank

The African Development Bank (AfDB) adopts nearly a same
standard as the World Bank. It focuses on ownership of the
company and the controlling mind of such a company. Focus is put
on shareholders, management of the company and employment
of citizens31.
Generally, the World Bank and AfDB standards have greatly shaped
the nature of local content laws and policies as seen in many
countries. Below are some of the recent laws and policies from
selected countries.
Nigeria
Nigeria passed the Oil and Gas Industry Content Act in 2010.
The law is meant to enforce the local content policy. It aims at
providing for the development of Nigeria Content in the Nigerian
Oil and Gas industry; for Nigerian Content Plan; for supervision,
31 African Development Bank (undated) Rules of procedure for procurement of goods and works
available at http://www.afdb.org/fileadmin/uploads/afdb/Documents/Project-related-
Procurement/Rules%20of%20procedure%20for%20procurement%20Goods%20and%20
Works.pdf accessed on 10/04/14
coordination, monitoring and implementation of Nigerian content
and for matters incidental thereto32.
Important to note from the Nigerian law is that it provides a

definition of local content and local company. This is important
in helping determining what a local company should be and also
determining what kind of participation (content) such a company
should be involved in. focus is put on using Nigerian human
resources, products or raw materials. Local content is defined as:
“the quantum of composite value added to or created in the

Nigerian economy by a systematic development of capacity
and capabilities through deliberate utilisation of Nigerian
human, material resources and services the Nigerian oil and
gas industry.”
Focus is also put on value addition for products used in the

industry. The Nigerian law defines a local company as;
“A company formed and registered in Nigeria in accordance

with the provisions of Companies and Allied Matters Act with
not less than 51% equity shares by Nigerians”
Unlike Uganda’s law which focus on registration of companies

which creates confusion as discussed earlier, the Nigerian law
addresses this by setting conditions for formation and registration
of a company in Nigeria. The three conditions for a company to
qualify as a Nigerian company are
i. The company must be formed in Nigeria

ii. The company must be registered in Nigeria and Nigerian law
iii. Majority shareholders of such a company must be Nigerians
The Nigerian law creates a the Nigerian Content and Monitoring
Board which is tasked with monitoring compliance with local
content requirements. In addition to the board, there is a Nigerian
Content Consultative Forum whose role is sharing information on
32 Preamble/long title to the Oil and Gas Local Content Act, 2010
21
local content issues such as procurement information, company
requirements and involvement of citizens.
Ghana
Ghana made its local content policy in 2010. This was followed by
the Petroleum Commission Act, 201133 which gives the Minister
responsible for energy powers to make regulations for local content
and citizen participation in the oil and gas sector. The policy
provides for mandatory local content in oil and gas. The petroleum
law defines local content as:
The use of Ghanaian human and material resources, services
and businesses for the systematic development of national
capacity and capabilities for the enhancement of the Ghanaian
economy34
A more refined definition of local content is given in the regulations

which define local content as:
The quantum or percentage of locally produced materials,

personnel, financing, goods and services rendered in the
petroleum industry value chain and which can be measured
in monetary terms.
From the above it can be said that Ghanaian law provides for broad
areas for local content. According to the local content regulations,
at least 5% stake in the oil and gas sector must be reserved for
Ghanaian companies. An indigenous Ghanaian company is defined
as:
A company incorporated under the Companies Act, 1963

(Act 179)
(a) that has at least fifty-one percent of its equity owned by a
citizen of Ghana; and
(b) that has Ghanaian citizens holding at least eighty percent of
executive and senior management positions and one hundred
percent of non- managerial and other positions;
33 Act 821
34 S. 28 Petroleum Commission Act of Ghana
From the above, it is clear that a local company has a strict
definition and includes such companies where citizens are the
driving engine of the company as well as are the main beneficiary
from the company. The regulations also create a Local Content
Committee whose role is to monitor compliance with the legal and
policy requirements for local content.
Liberia
Liberia passed its new petroleum law which provides for the
governance of the oil and gas sector in 2012. The law sets
conditions for involvement of local companies, training and
employment of citizens. The purchase of goods and services
from Liberian citizens is conditioned on their competitiveness.
Citizen companies and service providers must be able to effectively
compete.
The difference between Liberia and other countries such as Ghana

and Nigeria is that the citizens abilities to take part in the oil and
gas sector are considered. For example S. 2.5.8 of the Petroleum
Law of Liberia provides;
The holder of petroleum contract, as well as his subcontractors,

shall give preference to Liberian companies for construction,
supply, and service contracts, provided they offer equal quality,
price, quantity, time and performance and payment conditions.
Provisions like the ones above are good for the smooth running
of the industry and easily attract investment for being flexible,
however they may work against the interest of citizens since in
many African countries the local companies and citizens have not
developed much capacity to competitively compete with European,
American or Asian companies in the extractives sector. In the end
many citizens may be left out as being incompetent.
Trinidad and Tobago

The Trinidad and Tobago local content framework focuses on
increasing citizen participation through capacity building,
employment and service provision. The policy focuses on local
23
participation of citizens or local companies. Local companies are
defined and determined according to ownership, management and
financing (must be owned and managed by majority citizens). The
framework also seeks to maximize use of local resources in the
extractives sector. The framework creates institutions for managing
and overseeing compliance with the sector.
A look at the different countries and institutions above reveals that

though there are different approaches to local content in oil and
gas and extractive industry generally, most countries have tended
to protect their citizens and citizen businesses to take part in the
oil and gas sector through training, employment and provision
of goods and services. Whereas this is a good approach, the
local capacity of local businesses should be considered in taking
different approaches. This is necessary to ensure smooth running
of the industry while balancing the need for citizens to take part.
5. Policy recommendations for

Uganda
4.1 Make a Law on Local Content

Parliament should pass a law to provide for local content.
Specifically the new law should provide for a better definition of
Ugandan business entities, an independent authority to monitor
compliance with national local content plans as well as monitor
the development of national capacity among others.
4.2 Create Institution to Manage Local Content

Many countries have managed the local content aspect by creating
a dedicated institution to manage the local content aspect not only
in oil and gas but also in other sectors. Such an institution should
have powers to oversee and monitor compliance with the policy and
legal requirements for local content in Uganda including powers
to punish businesses that violate the local content requirements.
Parliament should by law create this institution which with powers
to audit compliance with local content policies and laws in Uganda
Mainstream other sectors in the oil and gas and extractive business
At present, there are disjointed efforts for the oil and gas sector.
There is need to coordinate the work and activities leading to
local participation in the oil and gas sector including coordinating
sectors such as education, agriculture, fishing, tourism,
manufacturing,, transport, insurance, and other service providers.
Government should come up and mainstream the other sectors
and line them to provide goods and services or to benefit from
the oil and gas sector.
4.3 Build Capacity for Industry Players

Capacity should be built for training institutions which are
targeting providing labour for the oil and gas market. This should
be expanded beyond UPIK to include other institutions. Focus
should also be put on developing capacity of institutions that
will provide support services; this includes a wide range of areas
such as business, agriculture, tourism, e.t.c. Deliberate efforts
should be dedicated to improving the performance of Ugandan
businesses which in the long term should focus on making these
businesses attractive to regional markets within the East African
Community and beyond.
4.4 Increase Inclusion in Decision Making

In order to increase inclusion and participation of citizens, there
is need to formalise the existing participation forums and ensure
there are formalised processes of consultations at different levels.
This should also enhance feedback at the community level and
community involvement in decisions such as Corporate Social
Responsibility (CSR), local participation and local content as well
as other company or government interventions.
25
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Publications in this Series
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Intellectual Property Rights in Building Science and Technological
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Paper, No.9, 2005. Kampala.
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International Standards at the Expense of Domestic Objectives. ACODE
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2010. Kampala.
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Strategy and Action Plan: The Crisis in Uganda’s Biodiversity Policy Making
Process. ACODE Policy Briefing Paper, No.12, 2005. Kampala.
Mugyenyi, O., Twesigye, B., and Muhereza, E., (2005), Balancing Nature
Conservation and Livelihoods: A Legal Analysis of the Forestry Evictions
by the National Forestry Authority. ACODE Policy Briefing Paper, No.13,
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and Natural Resources Sector: The Roots of Economic Crisis and Poverty:
A Policy Memorandum Submitted by ACODE to the 8th Parliament during
the debate on the budget for the Financial Year 2006/2007. ACODE Policy
Briefing Paper, No.14, 2006. Kampala.
Keizire, B., B., Muhwezi, W., W., Natuhwera, C., and Kayiso F., (2006),
Examining the Nexus between Nature, Wealth and Power in the Lake
George Fishery: The Case of Major Actors in the Fish Product Chain.
Mugyenyi, O., (2006), Gifted by Nature, Dispossessed by Parliament: The

Plight of Mpungu Community in Kanungu District. ACODE Policy Briefing
Mwenda, A., (2006), Redefining Uganda’s Budget Priorities: A Critique of

the 2006/07 Budget. ACODE Policy Briefing Paper, No.17, 2006. Kampala.
Tumushabe, G., (2007), Redefining Uganda’s Budget Priorities: A Critique

of the 2006/07 Budget (Executive Summary). ACODE Policy Briefing
Mwesige, P., and Muyomba, L., (2007), Deepening Democracy in Uganda:

Legislative and Administrative Reforms Ahead of 2011 Elections. ACODE
Policy Briefing Paper, No.19, 2007. Kampala.
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Governments: Challenges of Transition from the Movement System in
Uganda. ACODE Policy Briefing Paper, No.20, 2007. Kampala.
29
Naluwairo, R., and Tabaro, E., (2010), In Defense of Farmers’ and
Community Rights: Justifying their Inclusion in Uganda’s Plant Variety
Protection Legislation. ACODE Policy Briefing Paper, No.21, 2010.
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Card Report 2008/09: A Comparative Summary of Findings, Conclusions
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Resources Sub-sector: Undermining the Economic Base and Entrenching
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Reforming Uganda’s Education System for Equity, Quality, Excellence
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2013. Kampala.
31
ABOUT THE AUTHOR
Peter Magelah Gwayaka is a Research Officer. He formerly worked with Human

Rights Network -Uganda (HURINET-U) as a Project Officer in charge of law reform
project. Peter holds a Post Graduate in Legal Practice from Law Development
Centre (LDC), Kampala, a Bachelor of Laws (LLB) Degree from Makerere University,
Kampala and a Bachelor of Arts - Social Sciences from the same University. Peter
has worked on policy and legal reform and advocacy in Uganda including work on
the Access to Information Act, Prevention of Torture Act, and Equal Opportunities
Policy among others. He has also conducted research and training on various human
rights issues in Uganda which has gained a wealth of experience on various legal
and policy issues in Uganda and the East African region.
ISBN 978 9970 34 031 6
Advocates Coalition for Development and Environment

Plot 96, Kanjokya Street, Kamwokya
P. O. Box 29836, Kampala. Tel: +256 312 812150
Email: acode@acode-u.org; library@acode-u.org
Website: www.acode-u.org
9 789970 3403
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LOCAL CONTENT IN OIL AND GAS SECTOR

An Assessment of Uganda’s Legal and Policy Regimes

Peter Magelah Gwayaka

ACODE Policy Briefing Paper Series, No.28, 2014

Peter Magelah Gwayaka

ACODE Policy Briefing Paper Series No.28, 2014

All rights reserved. No part of this publication may be reproduced,

ISBN 978 9970 34 031 6

An aerial view of an oil exploration facility in Buliisa district, Uganda.

1.2 Study Scope.......................................................................................... 3

2. Local Content Vs Citizen Participation in Uganda................................ 3

3.3 BTVET Training for Oil and Gas in Uganda.............................................. 9

3.4 Local Content and Procurement from Ugandan Suppliers..................... 11

3.5 What Constitutes a Local Business Entity of Local Supplier?................. 12

3.6 What Parameters Should be Used to Determine a Local Company/

3.7 Treatment Of “Ugandan Company” by Other Laws in Uganda............... 14

4. Determination of Local Content, Experiences from the Other

ACODE Action Coalition for Development and Environment

I would like to thank the staff of ACODE in particular Onesmus Mugyenyi,

Uganda is not exception to the observation that many citizens

1.1 Study Objectives

1.2 Study scope

2. Local Content Vs Citizen

The term “citizen participation” involves two important items

Participation on the other hand involves taking part in processes

Assessment. Available at http://www.dictionnaire.enap.ca/dictionnaire/docs/definitions/

From the above definitions, it is important to appreciate that citizen

It is important to note that there is a tendency to mix ‘local content’

3. Oil and Gas Local Content

3.1 Training and Capacity Building for Citizens

The NOGP recognises the need for national participation through

(a) Promotion of state participation in Production Sharing

The Upstream and Midstream laws also require companies to

At present there is no proper system or institution charged with

On the other hand a total of 100,000 indirect jobs will be created

From the findings of the industrial survey, the following standout

1. The need to develop capacity in the technical and engineering

3.3 BTVET Training for Oil and Gas in Uganda

There have been attempts to reform BTVET training in Uganda

The Uganda Petroleum Institute, Kigumba (UPIK) was created as

According to UPIK’s strategic plan 2014-19, a Sector Skills Council

Presently there is debate on the location of UPIK, whereas UPIK

16 Makerere University, the biggest government University introduced courses in Petroleum

At present UPIK is able to graduate about 200 students in a year,

It should be noted that by design UPIK focuses on providing

3.4 Local Content and Procurement from Ugandan

3.5 What Constitutes a Local Business Entity of Local

(1)The licensee, its contractors and subcontractors shall

(2) Where the goods and services required by the contactor or

The licensee, its contractors and subcontractors shall give priority

Emphasis is placed on “registered entities” as opposed to

On the other hand using the place of incorporation as a

3.6 What Parameters Should be Used to Determine a

20 S. 53(1) Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act

The upstream law provides for affirmative action in training,

The reasons for not providing affirmative action for host

3.7 Treatment of “Ugandan Company” by Other Laws in

The Uganda Investment Code Act24 on the other hand defines a

(a) a person who is not a citizen of Uganda;

From the definition of this Act, a foreign company is determined

(a) in the case of companies with shares, the majority shares

25 S. 9 Uganda Investment Code Act

3.8 What Should be the Relationship Between the