China's CNOOC to spend $2 billion on Uganda oil field

China's CNOOC (0883.HK) has won a final production license for Uganda's Kingfisher oil field and will spend $2 billion over four years to develop it, a senior Ugandan official said on Thursday.

Uganda, which struck oil in 2006 and has estimated reserves of 3.5 billion barrels, is aiming for commercial output in 2016. It is one of several nations in the east African region looking to develop newly found hydrocarbons.

The Kingfisher field, with an estimated 635 million barrels of reserves of which 196 million are recoverable, would produce between 30,000 to 40,000 barrels of crude per day, Uganda's junior energy minister, Peter Lokeris, said.

"Developing the Kingfisher field is estimated to cost over $2 billion to be spent over the development period of four years," he said.

Production would be achieved by drilling 40 development wells, of which 27 would be producers and 13 would be injection wells, he said. Uganda would press on with a planned refinery and other infrastructure as CNOOC developed Kingfisher, he added.