The project, which has faced repeated delays since oil was discovered in 2006, is now advancing towards a Final Investment Decision expected by July 2026, following the signing of key agreements between the Uganda National Oil Company and the Dubai-based investor.
Speaking to Channel Africa, Energy Economist and Makerere University Business School Lecturer, Doctor Micah Abigaba, said the refinery’s progress must be understood within the broader development of Uganda’s oil sector. Uganda has an estimated 6.6 billion barrels of oil, of which about 1.65 billion barrels are considered economically recoverable. Commercial production is expected to begin before the end of 2026, with peak output projected at around 240 000 barrels per day.
Most of this crude will be exported through the East African Crude Oil Pipeline to Tanzania’s port of Tanga. The planned refinery, with a capacity of about 60 000 barrels per day, will process a smaller portion to meet domestic and regional demand.
Abigaba explained that delays in developing oil fields and supporting infrastructure in the Albertine region have had a knock-on effect on the refinery. Financing challenges linked to climate concerns and the project’s high cost have also slowed progress, making a strategic partnership essential.
He stressed that cross-border infrastructure agreements with neighbouring countries will be critical to the refinery’s success. Uganda is expected to consume between 27 000 and 40 000 barrels of refined petroleum products, with the remainder targeted at regional markets including the Democratic Republic of Congo, South Sudan, Rwanda and Kenya.
According to Abigaba, pipelines, road networks and other transport links would position Uganda as a cheaper and more reliable supplier by reducing logistics costs. Without such agreements, the refinery risks operating below capacity, undermining its economic viability.
On competition, Abigaba said Uganda’s refinery should not be measured against Nigeria’s Dangote Refinery, which operates on a far larger scale. With a planned capacity of 60 000 barrels per day compared with Dangote’s 650 000 barrels per day, Uganda’s safest strategy is to focus on serving regional markets rather than competing globally.
He concluded that securing cross-border infrastructure agreements will ultimately determine whether Uganda’s refinery becomes a sustainable pillar of the regional fuel supply chain.
–ChannelAfrica–
