Brazil and Uganda: government intervention and oil development prospects

Journal article

Brazil and Uganda have very similar petroleum industries. Both countries announced one of the largest oil discoveries in the last decade. Brazilian pre-salt discoveries proved the existence of large reserves which could lead to several billions of crude oil to be exploited. Uganda’s discoveries involve more than a billion barrels with the potential for more additions to current proved reserves in the future.

Although Brazil has produced oil for a relatively long period of time, it was never self-sufficient, until production was ramped up in 2006. Still today, Brazil’s production is relatively small, both in a global perspective and in the context of the size of the country’s reserves. Uganda in turn never produced oil in its history. Both countries hence find themselves in a similar situation aiming to develop their oil industries in order to significantly shape their economies in the coming decade.

In this article, we look at the similarities and differences in the two countries’ development approach towards their upstream sectors, with a focus on legislative changes made after the significant discoveries. Our two main conclusions are (i) Brazil’s more established oil sector is likely to move forward faster than Uganda, and (ii) both countries are losing valuable time by debating legislative changes in view of nationalist rather than primarily economic objectives.

Authors: Pereira, E; Karuhanga, E

• Publication status: Published
• Peer review status: Peer reviewed
• Publisher: Oxford Institute for Energy Studies
• Journal: Oxford Energy Forum
• Volume: 90
• Pages: 17-19
• Publication date: 2012-11-01
• Edition: Publisher's version
• ISSN: 0959-7727
• Language: English
• Keywords: OIES