1. INVESTMENT OPPORTUNITIES FOR DIASPORAS SME IN THE ENERGY & MINERALS SECTOR IN UGANDA 1 st Ugandan UK Convention 27 th August 2011 Presentation By Hon Eng Irene Muloni Minister of Energy and Mineral Development, Uganda 27 th Aug 2011 1

2. INTRODUCTION I want to thank Mr. Willy Mutenza for organizing this convention and I am honored to be able to present opportunities in the energy sector to Diaspora investors. In the medium term, the key priorities in the energy and minerals sector are:  to increase electricity generation capacity and development of the transmission network;  to increase access to modern energy services through rural electrification and renewable energy development;  to promote and monitor petroleum exploration and development in order to achieve local production; and  to promote mineral investment through the acquisition of geoscientific data and capacity building. 2

3. STRATEGIES TO INCREASE POWER GENERATION HYDRO Power Projects Being Developed There are a number of projects being developed inline with the National Development Plan. The majors ones are: Bujagali Project (under construction) – 250 MW Karuma Hydropower project - 600 – 700 MW Isimba Hydropower Project - 100 MW Ayago Hydropower Project – 600 - 700 MW The status of these projects is as follows: 3

4. i) Karuma Hydropower Project (700MW): Government is developing the Karuma project in the medium term as a strong public project. Energy Infratech Pvt. Ltd of India finalised the detailed feasibility study and preliminary designs, The tender documents have been finalised and the process for procurement of the EPC Contractor is underway. This hydropower station will constructed using funds from the Energy Fund as a Public Private Partnership with Government taking the lead. Construction work is expected to commence early 2012. 4

5. ii) Isimba Hydropower project: (100MW): This is located 15km after Kalagala falls on river Nile. The site has an estimated capacity of at least 140MW. Fitchner of Germany was contracted to undertake the necessary studies. The studies will be finalised by Dec 2011. The project will be developed by the private sector. Construction work is expected to commence in 2012. 5

6. iii) Ayago Hydropower Project (600 – 700MW) With the support of the Japanese Government, a consortium of Japanese power companies, J Power and Nippon Koei are carrying out the pre – feasibility study Full feasibility study of the Agago project will be undertaked later this year. Ayago will be developed as a Public Private Partnership. 6

7. Other Projects under the National Development Plan Study, design and construct Ariranga hydro power plant to generate 400MW Build a thermal Power Plant (700MW as part of the refinery) to utilize locally produced heavy fuel oil. Renewable Energy development Design and construct solar thermal plants to generate 200MW. Study, design and build Geothermal power plants to generate 100MW. Increase the co-generation capacity to 150MW from sugar factories using bagasse, wood, waste crop and garbage. Develop 150 MW from mini hydros. 7

8. Transmission Projects: A number of transmission lines have been earmarked to evacuate power from the generation plants. These include: Nkenda – Mputa – Hoima (132KV, 254km); Karuma – Kawanda (400KV, 264 km); Karuma – Olwiyo (132KV, 60km); Karuma – Lira (132 KV, 80km); Karuma-Gulu (132KV, 70km); Isimba interconnection (132KV, 40km); Kawanda – Masaka (220KV, 142km). 8

9. Transmission Projects Cont’d: Kampala – Entebbe (132KV); Mirama – Kabale (132 KV); Hoima - Kafu (132 KV); Lira – Gulu – Nebbi (132 KV); Opuyo – Moroto (132KV, 200km); Tororo – Opuyo – Lira upgrade (132KV, 260km); Mbarara – Nkenda (132KV, 160km) and Lira-Kitgum (132KV, 125km). 9

10. INVESTMENT OPPORTUNITIES Opportunities in Hydropower Development Participation in the Public Private Partnership (PPP). Contribution to equity. Participation in the Engineering, Procurement, and Construction (EPC) Contract. Supply of Equipment required in the project. Opportunities in Transmission include Contractors for the EPC supply of equipment such as transformers, cables 10

11. STATUS OF OIL AND GAS SECTOR STATUS OF EXPLORATION Total acreage of about 23,000km 2 5 active Production Sharing Agreements (PSA) PSA Operators and partners 11

12. LICENSING Due to systematic effort on promotion in the sector, five out of the 11 Exploration Areas (EA) in the Albertine Graben have been licensed to international oil companies. Over US$1bn invested in seismic data acquisition and processing in addition to the drilling of wells since 1998 by companies currently licensed in the country. The companies are Tullow Oil, Neptune Petroleum (U) Limited and Dominion Uganda Limited. The investment levels in this sector will increase with the expected entry of International Oil Majors like Total E & P and China North Offshore Oil Corporation (CNOOC). 12

13. 13 Oil Refinery in Uganda Government finalized a study for the refinery. The project is feasible and viable. The recommendation is to develop a 60,000 BOPD refinery that will later be expanded to 120,000 BOPD and 180,000 BOPD. Since the 60,000 BOPD Refinery takes 5 years to develop, the strategy is to start with a modular small refinery of 20,000 BOPD delivered within 3 years.

14. Investment Opportunities in the Service Provisions Clearing and Forwarding; Flight Charters Insurance Services; Civil construction for access roads and drilling pads; Environmental Consultancy including associated R&D; Provision of ICT services and facilities; Provision of Security services to protect the investment and terror threats; Catering/Camping services 14

15. Investment Opportunities in the Upstream Oil and Gas Sectors Joint Ventures and farm-in arrangements in existing licences; General works and construction, Logistical services, Geophysical surveys, particularly seismic surveys, Construction and Fabrication, Refining and infrastructure development (e.g. pipelines), Future petrochemical industry and many others. Capital for the emerging infrastructure such as refining and transportation of petroleum commodities and products; and Power generation by Independent Power Producers 15

16. CONCLUSION Investment in the Energy, Oils and Gas sectors is priority number one for the Government. These Sectors are expanding very fast with a legal and institutional framework for carrying out business offering tremendous opportunities. 16

17. CONCLUSION The opportunities include:- Participating in the construction of Hydroelectric Power Plants, construction in transmission lines, construction of small renewable energy projects and in Rural Electrification programmes. Supply of equipment in the sector. Participating in the construction of the Petroleum Refinery and the associated infrastructure. Participation in the exploration of minerals and Petroleum resources. Sponsoring and financing of projects in the sectors at attractive rates of return. The above, combined with the accountable leadership, which we have, will ensure sound returns for your investment. 17