Oil & Gas

Uganda has signed a landmark tripartite agreement with Tanzania and Zanzibar to enhance regulatory cooperation in the oil and gas sector. The agreement, signed in Entebbe on June 17, involves Uganda’s Petroleum Authority (PAU), Tanzania’s Petroleum Upstream Regulatory Authority (PURA), and the Zanzibar Petroleum Regulatory Authority (ZPRA). The deal aims to harmonise regional standards and coordinate efforts in petroleum resource management, cost efficiency, environmental protection, local content promotion, and skills development. Uganda is pushing toward its goal of beginning oil production in 2026, despite delays surrounding its refinery project.

At the signing ceremony, PAU Board Chairperson Lynda Biribonwa emphasized the strategic importance of regulatory collaboration, stating that the East African region holds immense potential for oil and gas exploration. She said the partnership would help leverage collective expertise and attract more investment. The new Memorandum of Understanding formalises years of informal engagement, especially between Uganda and Tanzania, who are already collaborating on the $5 billion East African Crude Oil Pipeline (EACOP), which will export Uganda’s oil through Tanzania’s port of Tanga.

The cooperation agreement arrives amid ongoing questions about Uganda's oil infrastructure, particularly its proposed oil refinery in Hoima District. Uganda signed a $4 billion deal in March with UAE-based Alpha MBM Investments LLC to construct the refinery, which is projected to process 60,000 barrels of crude oil daily. Under the agreement, Alpha MBM will hold a 60% stake, while Uganda’s National Oil Company (UNOC) will own the remaining 40%. However, further contractual details have yet to be finalised, and a construction start date remains unclear, raising concerns about potential delays and the country’s ability to meet its 2026 oil production target.

PURA Director General Charles J. Sangweni noted that the agreement had been in negotiation for over a year and hinted at expanding cooperation to other regional players like Kenya. Delegations from Tanzania and Zanzibar are expected to visit Uganda’s Albertine Graben oil fields this week to evaluate progress. Uganda currently estimates its recoverable oil reserves at 1.4 billion barrels. Officials at the event reiterated the power of unity, quoting the Swahili proverb “Umoja ni nguvu” (unity is strength), and expressed hope that the new agreement would drive East Africa’s energy transformation and position the region as a key player in global petroleum markets.