The Ugandan cabinet said on Thursday that the energy ministry would enter into PSAs with two oil companies, including a subsidiary of Australia’s DGR Global, for two oil exploration blocks.

During a cabinet meeting on Monday, the government reportedly accepted the signing of a contract with DGR Energy Turaco Uganda Limited, which is owned by Australia’s DGR Global, for the Turaco exploration area, according to a junior minister of information, Godfrey Kabbyanga.

The 637 square kilometre exploration area is situated in the Albertine Rift valley of Uganda, close to the Congo border. Kanywataba, an exploration site in the region, is already owned by another division of DGR Global and was purchased by it in 2017.

The second agreement, for the 1,285 square kilometre Kasuruban exploration area, is with Uganda’s state-owned Uganda National Oil Company (UNOC).

In a licensing phase that began in 2019, Uganda auctioned off five blocks, including the two exploration zones. According to the release, the corporations will initially receive two-year exploration licenses for the areas.

Uganda first found commercial crude oil reserves in 2006 in the Albertine Rift basin. The first oil will be produced from the ground in 2025.