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Uganda to commence construction of oil refinery next year

The Ugandan government has set next year as the date when the country will commence construction of a crude oil refinery. The crude oil refinery will be constructed at Kabaale village in Hoima district. The refinery is expected to produce 60,000 barrels per day which is expected to double once the project is completed.

Land of 29 square kilometers in Kabaale Parish in Hoima District has been secured for the construction of the US$2.5bn infrastructure, alongside an aerodrome, staff quarters, chemical treating plants, and amenities like hospitals.

The refinery will be developed in two phases, starting with 30,000 barrels-per day to allow oil production start in 2017 but another subsequent phase will be added by 2020

The permanent secretary in the Ministry of Energy and Mineral Development, Kalisa Kabagambe, indicated that the project will mark the start of Uganda’s energy independence and enhance the energy security by unleashing opportunity of the country’s rich oil resources. Uganda is sitting on an estimated 3.5 billion barrels of crude oil. The government is in the process of evaluating bids from qualified investors to undertake the project.

He also revealed that similar works on the pipeline from Hoima to Kampala will soon start to take the product to the market through to Kenya.

Meanwhile Oil firms Tullow Plc, Total E&P and CNOOC have agreed on the cooperation framework to guide production, refining and export of oil products from Uganda to other parts of the world. The firms however are keen on the pipeline which will enable them to export the product via the Kenyan coast because the projected oil volumes will exceed national and regional demand.


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