Uganda's political opposition says that if it comes to power in 2011, it will renegotiate the production-sharing agreements the government signed with Tullow Oil and other exploration companies, which later found massive reserves of oil below Lake Albert.
The civil society group Platform (motto: "Promoting creative processes of democratic engagement to advance social and ecological justice"... phew!) offers evidence that Uganda is getting a raw deal from the contracts, which have not been made public but were leaked on the web. Platform says the oil companies stand to reap "excessive profit" from the deals.
You can't fault opposition leaders for vowing to scrap the existing contracts. Doing so is as good a campaign tactic as any ahead of an election they have absolutely no chance of winning. And oil is a messy, high-stakes business; it seems like someone is always trying to pull a fast one.
At the same time, Platform's tut-tutting of the oil companies seems misplaced. It's easy to forget that a few years ago, almost no one believed Uganda had any oil at all. Wildcatters that spend millions of dollars exploring high-risk areas (Tullow says it has dropped $500 million on Uganda so far) ought to expect to make a tidy profit if they strike oil. It's one thing to negotiate a contract when you don't know if you'll find oil; it's another thing entirely to negotiate a contract when you know you're sitting on 2 billion barrels of oil. The risk factor disappears.
Platform says the contracts will deliver Tullow massive profits but "prevent the Ugandan people from receiving their due benefits." What should people expect of an oil company, whose job, presumably, is to maximize profit? You can't expect Tullow to say, "Hey, waitaminutehere, our profit is going to be excessive in Uganda. Scale it back, Bob."
The oil companies are not the issue. Government corruption and a deeply entrenched patronage system will almost certainly ensure that Uganda's people don't benefit from the oil anyhow.