Ugandans Go for African Contracts as First Oil Drop Nears

Following the evaluation of the works on the East African Crude Oil Pipeline (EACOP) project, the government and the oil and gas industry players have started a count-down to Uganda’s first oil drop. 

The industry has put the completion level of the export pipeline at close to 90 percent today, while pre-commissioning and commissioning testing phase (including hydro testing) exercises are ongoing to determine the facility’s readiness, according to the Petroleum Authority of Uganda (PAU).  

These tests ensure the pipeline, pump stations, tanks, and marine terminal are safe, leak-free, and ready to transport heated crude oil.     

In the upstream, especially in the Tilenga and Kingfisher project areas, pipelines are now being buried, ready for the transportation of crude to the central processing facilities to the EACOP. 

This update was given ahead of the 11th Oil and Gas Convention due next week at Speke Resort Munyonyo.   

Gloria Sebikari, the Manager Corporate Affairs at PAU, stresss that the main challenge for the implementers will be ensuring that the production and the revenues arising, will be utilized for the benefit of Ugandans. 

The completion of the export pipeline is vital for the industry to take off, as all the crude produced has to be taken to the coast (Tanga Port, Dar-es-Salaam) for export to the international market.  

Major facilities, including tanks, pump stations, and the marine terminal, are also actively undergoing or preparing for these tests, with the Authority projecting first export at October 2026, subject to successful completion of these tests. 

Sebikari expressed confidence that the requisite facilities, including the industrial park and the airport will all be in place by that time, though a specific date for first oil cannot be announced now. 

PAU says it is committed to partnering with Uganda Chamber of Energy and Minerals (UCEM) at this time of transitioning from years of preparation into the petroleum production and operations phase, unlocking long-term national value. 

   

Humphrey Asiimwe, the UCEM Chief Executive Officer says that the exploration and construction of facilities have already provided their benefits, but that the next period (20 to 30 years) also comes with operational opportunities in maintenance, digitalization, and equipment supply.  

The the sector’s impact beyond extraction, so far, has seen over USD 2 billion awarded to local firms, creating about 80,000 jobs, and more than 7,000 Ugandans trained to strengthen national capacity, Asiimwe says. 

Asiimwe says their campaign now is to make sure as many Ugandans benefit from the next phase as possible on top of what has been achieved so far in terms of local content.   

Looking beyond Uganda’s oil, Asiimwe says the campaign has enabled local companies be able to compete for opportunities in the oil and gas industry in other countries in Africa.     

Threeways Shipping Services (Group) Ltd, a logistics company founded by Hoima brothers Oscar and Jeff Baitwa, is one of those that have been involved in the oil and gas industry, from transporting initial equipment for exploration, to the heavy drilling rigs for well preparations. 

Jeff Baitwa admits that those who persisted and were patient have benefited from the developments, despite challenges like the ongoing conflicts in the Middle East that are making shipping difficult and expensive.

However, he says, several companies have gained the required experience to bid from contracts in other oil and gas industries away from Uganda. He asks the government to have an affirmative policy that will help more Ugandan countries scale their capabilities for these continental and global opportunities.

At the upcoming conference, companies, participants are expected from as far as Kenya and Nigeria to join their Ugandan counterparts. Prospective participants are advised to approach the Uganda Chamber of Energy and Minerals.