By Tom Oniro Elenyu in Kampala
Whereas Uganda is salivating at earning nearly $2 billion accruing annually from crude oil sales in about a 25-year-period once production is greenlit, President Yoweri Museveni claims that people who do not care about Africa were hell-bent on grabbing the black gold. “This year, your [Ugandans’] oil will start flowing. The people who don’t care about Africa wanted to grab this oil and take it for others,” Museveni said on January 26 at the ruling National Resistance Movement (NRM) 40th Anniversary celebrations in Kampala.
Museveni catapulted himself to power on this day in 1986. “Now,” he went on, “the economy is moving very fast. We’re growing at 7% now…This is big growth, and we’re going to grow even more…With oil, we’re going to double digits.”
Upon being declared victor of the January 15 presidential polls that have protruded his presidency to 45 years consecutively, Museveni, in his victory speech on January 18, said: “Very soon, we shall start pumping the oil. We shall have the money to deal with infrastructure—the railways, power stations, roads and science education…Our focus is to use the oil [money] to build durable wealth.” He acknowledges that Uganda’s oil has a definite lifespan, and therefore, should be used strategically for productive rather than consumptive purposes to transform the economy.
On January 8, the Finance ministry’s Permanent Secretary and Secretary to the Treasury, Ramathan Ggoobi, said Uganda anticipates to earn about $1.94 billion yearly from oil production; earmarking the oil money for infrastructure development through a petroleum fund managed at the central reserve—Bank of Uganda.
In 2026, Global Energy Investment, according to the International Energy Agency, is projected to touch $3.3 trillion. Clean energy alone is predicted to swallow $2.2 trillion; sparing $1.1 trillion attraction to oil, gas and coal.
Aiming to become the spinal cord of the energy market in Africa, this January at State House, Entebbe, the country received the substantial backing of a United Arab Emirates-based investor to advance the national refinery project in 2026 by partnering with the Emirati Alpha MBM Investments LLC to advance the $4 billion national refinery project so that it can reach a Final Investment Decision following protracted delays.
The agreement will see Uganda National Oil Company (UNOC) working together with UAE’s Alpha MBM Investments to bring the national refinery project take off the ground.
“The oil refinery is not just about fuel; it is about Uganda producing and exporting refined products instead of importing. We must stop exporting raw materials and instead add value to everything we produce,” said Museveni at the signing ceremony.
According to the country’s statutory investment nectar—the Ugandan Investment Authority—Alpha MBM will hold a 60% stake in the national refinery project; leaving the 40% pie to UNOC.
“The project will create thousands of jobs, develop local expertise, and serve as a springboard for industries for such as petro-chemical and fertilizer production,” Ruth Nankabirwa, the minerals minister, said, adding: “It will also attract Ugandan businesses to participate in the supply of goods and services, and boost local enterprise development.” The development and implementation of the envisaged refinery positions Uganda to become an energy hub in the East African region where it currently spends an approximate $2 billion on importing petroleum products every year.
Excavation results from the statutory Petroleum Authority of Uganda (PAU) archives indicate that the earliest reference to oil in Uganda was in reference to an oil seepage near Kibiro on the shores of Lake Albert which was known to the indigenous people who lived in the area.
The first contribution to the evaluation of the country’s hydrocarbon potential was by E. J Wayland, a colonial government geologist, who documented numerous hydrocarbon occurrences in the Albertine Graben in the 1920s. “Geologist E. J. Wayland is considered the father of Ugandan oil exploration, as he documented hydrocarbon occurrences in the Albertine Graben in 1925, sparking the country’s first oil exploration efforts…He mapped out signs of oil and his 1925 publication, Petroleum in Uganda, detailed numerous oil seepages, leading to the first shallow wells being drilled in the 1930s,” PAU records reveal.
His work led to the first exploratory wells being drilled in the 1930s by African-European Investment Company with the first deep well, Waki-B1, drilled in 1938.
Oil exploration continued intermittently through the 1930s but came to a halt during the Second World War. Serious exploration work commenced again in early 1980s [during Milton Obote II regime] with the acquisition of aeromagnetic data across the entire Graben and the subsequent follow-up ground geophysical and geological work in the late 1980s and 1990s. Seismic data was first acquired in the Graben during 1998 and several surveys have been undertaken to date. Over one hundred wells have been drilled from 2002 to date and more are planned.
According to the archives, change in colonial masters’ policies; East Africa was zoned for agriculture and West Africa for oil exploration. Post-independence political uncertainties and instability in Uganda, too, frustrated oil exploration.
But the Pan-Africanism in Museveni will have none of such background. “The British were here for 68 years… but they tried looking for our oil; they didn’t see it, and now we’ve it,” Museveni said on the 63rd Independence Anniversary on October 9, 2025 in Kampala. Uganda became a British Protectorate in August 1894 and gained independence on October 9, 1962.
“You can see how God loves NRM–[the ruling party]—and by God’s grace, oil will be flowing,” Museveni beamed: “We shall concentrate on [funding] key sectors [using oil money]; including defence, roads, electricity, education, health, clean water and wealth creation.”
Addressing a press conference at his Kampala-based Nakasero State Lodge in July 2011, Museveni thumped his chest, thus: “my oil.”
Uganda’s oil has caught the attention of environmentalists opposing it from within and outside; reminiscent of corruption, weak oversight and environmental damage the oil resource curse has inflicted in many oil-producing countries in Africa.
Little or no oil revenue drips into the State coffers as host communities bear the brunt of the environmental and social consequences to their detriment. In Nigeria, for example, the ethnic minority Ogoni people of Ogoni land in the Niger Delta stand-out as their community was targeted for crude oil production since the 1950s. They suffered decades of indiscriminate petroleum waste dumping and when their only then voice, environmental activist Ken Saro-Wiwa led a non-violent campaign, he was court-martialed and eventually “abachalised” or hanged on November 10, 1995 by then military dictator Gen Sani Abacha.
Yet at peak production, the oil is forecast to fetch $2 billion yearly within the following five years alone. Expectations dangle high that the envisaged oil flow will leapfrog GDP to nearly $8.6 billion in the longer-term.
“I’m happy to report to Ugandans that by June 2026, the economy of Uganda will be $66.9 billion in size using the Foreign Exchange method, and $197.9 billion using the Purchasing Power Parity method,” the president promised on October 9, 2025. “After the flow of the oil,” Museveni continued, “the economy will grow by double digits. This economy was $3.9 billion in 1986. Since that time, the economy has gone through…Phases of 3Ts and 3Cs, and ending the shortage of essential commodities. Phase Two [is the] expansion of the economy.”
Uganda’s colonial and post-independence economies sourced foreign earnings from growing and exporting tea, tobacco as tourism attracted foreign exchange as well —ideally the 3Ts. Uganda mined and smelted copper at Kilembe in the west for export, grew cotton and coffee to earn foreign currency; therefore, the 3Cs.
In fact, the colonial administration’s Imperial British East African Company started building the Uganda Railway in 1896 to ease the transportation of these raw materials; especially copper and tobacco, to Kenya’s Indian Ocean coastal port city of Mombasa for on-ward shipping. “Phase Three,” according to Museveni, “[is] diversification by taking on board new items, value-addition and the knowledge economy of science and technology.”
On the campaign trail for the 2026 general elections, former main opposition Forum for Democratic Change’s secretary-general and presidential candidate, Nathan Nandala-Mafabi cautions: “Oil shouldn’t be a curse; it’s God-given and should benefit the people of Uganda. All resources we get must be applied to productive sectors to avoid leakage and extravagance.”
In June 2006, oil was discovered in the Albertine Graben; mid-western Uganda. The joint venture partners in China National Offshore Oil Company (CNOOC), French Total Energies and Uganda National Oil Company (UNOC) are developing the oil extraction. Total Energies Exploration and Production bags 56.67% majority active participation interest, compared with CNOOC’s 28.33%. UNOC carries 15% interest.
As part of the $5 billion 1445km East African Crude Oil Pipeline (EACOP) construction, Total Energies owns 62%, UNOC 15% and CNOOC 8%—an ownership structure signaling oil proceeds being salted away by foreign companies. Tanzania’s Petroleum Development Corporation has 15%.
In September last year, CNOOC—the developers of the Kingfisher Development Area- (KFDA)– said 15 out the 17 oil wells had been completed, and oil production would likely begin in mid-2026 and dawn of 2027. KFDA alone is expected to produce 40,000 barrels of oil per day from its 31 oil well pads. The Construction of the Central Processing Facility (CPF), according to piping engineers, is currently 93 per cent complete. CPF is where oil from the wells is processed; sieving oil from sand and water for eventual export.
CPF hosts, among others, crude oil and gas treatment units, storage and export facilities, Liquefied Petroleum Gas (LPG) production and storage, water treatment and injection systems, power generation, heating, firewater, and chemical injection systems.
The flowlines which connect the drilled wells to the CPF, are on layout and once processing reaches the tail-end, the crude oil is transported through a 48-kilometer feeder pipe. So far it is estimated that Uganda’s oil resources are at 6.65 billion barrels.1.65 billion barrels are economically recoverable, and projected production will reach 230,000 barrels per day.
EACOP will transport Uganda’s crude oil from the oil fields in the Albertine Graben to Tanzania’s Indian Ocean port of Tanga.
