Working paper 128
Uganda is frequently lauded for adopting a rules-based approach to oil governance, despite having failed to move to production after discovering commercial quantities of oil in 2006. This has been closely associated with the political support and autonomy offered to a ‘pocket of bureaucratic effectiveness’ (PoE) within the Ministry of Energy that has managed to secure favourable deals with international oil companies. However, since 2013 Uganda’s oil assemblage has undergone significant institutional reforms in line with international best-practice, with new entities established to ensure that the policy, regulatory and commercial dimensions of the sector are now handled separately. This paper explores whether best-practice reforms make sense within a country like Uganda, particularly given its changing political settlement dynamics in recent years. We find that the interaction of these reforms with the increasingly vulnerable and factionalised ruling coalition in Uganda has led oil governance to become more fragmented and personalised in certain respects, but also that its previous investment in building a PoE has enabled government to manage the process better than expected, often through the continuity of informal practices. Whilst the nascent move to build the new regulatory and commercial entities into PoEs is potentially promising, tensions between these two organisations, and the fact that this process has involved hollowing-out capacity within the policy department, has weakened the coherence of oil governance in Uganda, and undermined its ability to undertake policy reforms and the further exploration required to secure the viability of the oil sector.