Uganda has signed a three-party agreement with Tanzania and Zanzibar to enhance cooperation in regulating the oil and gas sector. The move comes as Uganda works toward its target of producing its first oil by 2026, even as questions remain about the timeline for its long-delayed refinery project.
The agreement brings together Uganda’s Petroleum Authority, Tanzania’s Petroleum Upstream Regulatory Authority, and the Zanzibar Petroleum Regulatory Authority to collaborate on key areas of petroleum development.
The deal focuses on aligning regional standards and joining forces on managing resources, cutting costs, ensuring environmental compliance, boosting local content, and building technical capacity.
Speaking at the signing ceremony, Lynda Biribonwa, Chair of Uganda’s Petroleum Authority, described East Africa as a promising region for oil and gas development. She said regulators need to work together to share knowledge and attract investment.
The new Memorandum of Understanding builds on years of informal collaboration, especially between Uganda and Tanzania. Both countries are backing the $5 billion East African Crude Oil Pipeline, which will move Uganda’s oil to international markets through the port of Tanga in Tanzania.
PURA’s Board Chair, Halfani R. Halfani, said the agreement will allow the countries to exchange best practices and prepare for long-term investment. Muhammed S. Said, Managing Director of ZPRA, added that pooling regulatory expertise will help advance the region’s broader energy ambitions.
This agreement comes at a time when Uganda’s domestic oil infrastructure is under increased scrutiny. In March, the government signed a deal with UAE-based Alpha MBM Investments to develop a refinery in Hoima that is expected to process 60,000 barrels of crude oil per day.
Under the deal, Alpha MBM will hold a 60 percent stake in the refinery, while Uganda’s state-owned National Oil Company will own the remaining 40 percent. However, the government has not yet finalized other essential agreements with the investor, and construction is yet to begin.
If the refinery remains incomplete, Uganda may be forced to export all of its crude through the pipeline once it becomes operational. While the government still aims for a 2026 production start, experts have warned that any further delays in infrastructure development could affect investor confidence and push back revenue generation.
Charles J. Sangweni, Director General of PURA, said discussions for this agreement have been ongoing for nearly a year. He also hinted that the cooperation may expand to include other East African countries such as Kenya.
This week, delegations from Tanzania and Zanzibar will visit Uganda’s oil fields in the Albertine Graben to see firsthand how preparations for production are progressing.
Sangweni said the agreement lays the foundation for stronger technical partnerships in the region.
Uganda currently estimates its recoverable oil reserves at 1.4 billion barrels. Once completed, the Hoima refinery is expected to reduce the country’s reliance on imported petroleum and create more local economic value.
Officials at the event emphasized the importance of working together and echoed the Swahili saying “Umoja ni nguvu,” which means unity is strength.
Biribonwa closed the ceremony with a call to action, urging regional partners to shape a new and collaborative future for East Africa’s oil and gas industry.
source:allafrica.com
