By Ssenkayi Ezra Marvin
Uganda’s long-delayed national oil refinery project has entered a critical phase after the government finalised key agreements with a United Arab Emirates-backed investor, moving the $4 billion development closer to execution.
The project is now advancing towards a Final Investment Decision (FID), which government officials say is targeted for July 2026. This follows the signing of partnership agreements between the Uganda National Oil Company (UNOC) and Alpha MBM Investments LLC, a Dubai-based firm selected as the project’s strategic investor.
Once completed, the refinery, which will be located in the Albertine Graben, is expected to process up to 60,000 barrels of crude oil per day. The facility is intended to reduce Uganda’s reliance on imported petroleum products, which currently cost the country an estimated $2 billion annually and place significant pressure on foreign exchange reserves.
President Yoweri Museveni, who presided over the signing ceremony at State House in Entebbe, said the refinery was central to Uganda’s efforts to add value to its natural resources. He described the project as part of a broader strategy to shift away from exporting raw materials and importing finished products, a pattern he said has constrained industrial growth.
Under the agreed ownership structure, Alpha MBM Investments will hold a 60 per cent equity stake in the refinery, while UNOC will retain 40 per cent, according to the Uganda Investment Authority. The arrangement follows years of stalled negotiations with previous partners and is being presented by the government as a sign of renewed investor confidence in Uganda’s oil sector.
Beyond domestic supply, officials say the refinery is intended to serve regional markets, including South Sudan, eastern Democratic Republic of Congo, Rwanda and Burundi. These countries currently depend largely on fuel imports transported through ports in Kenya and Tanzania. If operational, the Ugandan refinery could reduce transport costs and improve fuel supply reliability for landlocked economies in the region.
The project comes at a time of continued volatility in global energy markets, driven by geopolitical tensions, supply disruptions and rising demand in developing economies. In response, many African governments are prioritising domestic refining capacity as a means of strengthening energy security and retaining more value from natural resources.
Uganda’s refinery is expected to complement the country’s upstream oil developments and its planned crude export pipeline, reinforcing its position within regional energy trade networks.
Energy Minister Ruth Nankabirwa said the project would create thousands of direct and indirect jobs and help develop local expertise in refining, petrochemicals and related services. She added that the refinery could support the growth of associated industries, including fertiliser and petrochemical production, while increasing opportunities for local firms to participate in supply chains.
Industry analysts note that additional downstream investments, such as storage facilities, pipelines and industrial parks linked to the refinery, could strengthen Uganda’s manufacturing base, which remains relatively small compared with the country’s population and economic ambitions.
For Alpha MBM Investments, the deal reflects growing Gulf interest in African energy infrastructure projects supported by governments and underpinned by long-term demand growth. The partnership allows Uganda to proceed with detailed engineering, financing arrangements and regulatory approvals ahead of the planned FID.
While large-scale refineries typically take several years to complete after a final investment decision, Ugandan authorities say early preparatory work could help shorten delivery timelines. However, challenges remain, including complex financing requirements, infrastructure coordination and evolving global attitudes towards fossil fuels.
Nevertheless, with key contracts signed and a defined timeline in place, 2026 is shaping up to be a pivotal year for Uganda’s oil ambitions. If delivered as planned, the refinery could significantly reshape the country’s energy landscape and strengthen its position as a regional refining hub.