Uganda's Oil and Gas Industry Nears Commercialization

The Ugandan government is poised to commercialize its oil and gas industry, as the necessary infrastructure nears completion. Energy Minister Ruth Nankabirwa announced that negotiations with Alpha MBM Investments LLC for the development of a refinery project are in the final stages.

Meanwhile, progress on the Tilenga and Kingfisher oil fields continues at a steady pace according to the Minister. To date, 63 of the 426 planned oil wells on Total Energies' Tilenga project have been drilled, and nine out of eleven wells required for first oil on the Kingfisher escarpment have been completed.

The East African Crude Oil Pipeline (EACOP) is also making significant strides, and the Ministry of Energy anticipates that it will be operational by the time of first oil production in 2025.

"A Memorandum of Understanding (MOU) for the development of Uganda's refinery was signed by the Government with Alpha MBM Investments LLC from the United Arab Emirates in December 2023," Minister Nankabirwa stated.

Minister Nankabirwa said the government of Uganda and Alpha MBM Investments LLC are currently negotiating key commercial agreements, including the Implementation, Crude Oil Supply, and Shareholders Agreements. Upon completion of these agreements, the consortium is expected to commence project implementation.

Minister Nankabirwa emphasized the importance of these initiatives for Uganda's economic growth and development. "These initiatives are crucial to Uganda's goals of increasing oil production, propelling economic expansion, and generating substantial national income," she said.

She revealed that the Petroleum Authority of Uganda has approved contracts worth US$ 5 billion for the Tilenga, Kingfisher, and EACOP projects, out of which US$ 2 billion has been awarded to Ugandan businesses. She said the sector has also generated employment for over 14,000 people, with 90% of them being Ugandans.