Chinese Firm Announces Uganda Oil Deal

China National Offshore Oil Corporation (CNOOC) has confirmed a massive new investment in a major Ugandan oil field.

The Kingfisher field is believed to hold 635 million barrels of oil and the organisation thinks it will be able to extract 196 million barrels from the location.

CNOOC revealed that it has paid $2 billion (£1.3 billion) for the right to develop the oil field in Uganda. It will look to increase production of oil from the site over the next four years.

Peter Lokeris, Uganda's junior energy minister, said the initial capacity of the oil field is set to be between 30,000 to 40,000 barrels of oil per day.

China – which has the world's second largest economy behind the US – has allayed fears it has experienced an economic slowdown in recent months and this latest deal is likely to be another positive sign for the state of the nation's finances.

A growing middle class is increasing demand for oil and China has moved to support that need with the deal for the Kingfisher oil field.

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