The hope of Ugandans seeing their country become an oil producer this year has again been cooled, but not dashed. The government has once again revised its timeline for the commencement of oil production in the country, now aiming for June 2026.
This is not the second time the country will shift the date by which the country will start oil production, nearly two decades after the discovery of commercial oil reserves in the Albertine Graben region.
The new date was announced by Frank Mugisha, Assistant Commissioner at the Ministry of Energy and Mineral Development, during the Third Annual Joint Civil Society Conference in Kampala.
Mugisha revealed the sector is currently over 60% ready for first oil, with significant progress at key production sites.
He stated that the Kingfisher and Tilenga projects are each at 60% completion, and the government is confident that oil production will commence by June 2026 without further extensions.
The Kingfisher project, located in Kikuube District, is being developed by the China National Offshore Oil Corporation (CNOOC), while the Tilenga project, spanning Buliisa and Nwoya districts, is operated by TotalEnergies.
As of mid-March 2025, over 100 wells had been drilled by these companies, according to the Petroleum Authority of Uganda
Despite this progress, the journey to the first oil has been fraught with challenges, including logistical, financial, legal, and infrastructure-related hurdles.
Delays in constructing essential infrastructure such as the refinery and the East African Crude Oil Pipeline (EACOP) have contributed to the shifting timelines.
EACOP is now set for completion in 2027.
In March 2025, the Ugandan government signed an agreement with UAE-based Alpha MBM Investments LLC to construct a 60,000-barrel-per-day refinery in Hoima District.
This project aims to reduce Uganda’s dependence on imported petroleum products.
The refinery deal grants Alpha MBM a 60% stake, with the remaining 40% held by the Uganda National Oil Company (UNOC).
However, construction has not yet started, and key agreements are still pending.
Until the refinery becomes operational, experts suggest that all crude oil is likely to be exported via the EACOP.
A country of about 46 million people, Uganda races against time to meet the 2026 deadline, leaving industry watchers cautiously optimistic.
The looming oil sector holds promise for transforming the country’s economy through job creation, infrastructure development, and increased government revenues.
However, much depends on timely project execution, transparency, and sound governance.
The International Monetary Fund (IMF) projects that Uganda’s economy could grow by up to 10.8% in the 2025/2026 fiscal year when oil production starts.
This growth is expected to have a lasting positive impact on the country’s fiscal and current account balances.
While the June 2026 target offers renewed hope, the path to the first oil remains contingent on overcoming existing challenges and ensuring that the benefits of oil production are equitably distributed among Ugandans.