Uganda's oil drilling efforts are taking shape as the country looks to develop its oil and gas industry. Last week, the country received the first batch of coated line pipes as part of its preparations to export the first barrels of crude oil by the end of next year.
Uganda's 74 new oil wells, located in the Tilenga and Kingfisher production areas, are expected to help the country become self-sufficient in oil.
This development has also generated interest among other East African Community (EAC) members who hope to reduce their own costly oil imports by tapping into Uganda's resources.
Officials at Rwanda's Ministry of Trade and Industry told The New Times that Uganda's emerging oil production presents an opportunity for downstream petroleum industry and is expected to have an impact on the oil prices in the region.
"As Uganda develops its refinery and the East African Crude Oil Pipeline (EACOP), Rwanda stands to benefit from increased access to competitively priced refined petroleum products,"reads a statement from the Ministry.
According to the Ministry of Trade and Industry, this development could lead to lower transportation costs, improved fuel supply stability, and boost infrastructure growth across regional borders.
"This will also foster stronger regional economic integration, positioning Rwanda to capitalise on enhanced trade and investment opportunities in the energy sector," the statement noted.
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Regional ambitions
The EACOP is set to be a cornerstone of Uganda's oil ambitions. The project represents the largest investment in the country's history, estimated between $15 billion and $20 billion.
Tony Otoa, Chief Corporate Affairs Officer at the Uganda National Oil Company, highlighted that around $5 billion will be injected into EACOP itself, and that the investment is expected to create 135,000 jobs.
"For Uganda, this is the biggest investment the country has ever had. It will have a ripple effect on other sectors of the economy through direct employment, provision of goods and services and knowledge/skills transfer," he told this publication.
Otoa emphasised that the oil sector will catalyse growth across various sectors of the economy, fostering technology transfer and local capacity building.
"The oil and gas projects, therefore, have a positive impact not only in Uganda but the East Africa region as well," he added.
Uganda expects the first oil exports to be on the market in the last quarter of 2025, with the crude oil expected to reach the international market thereafter.
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Eric Mutaganda, Chairman of the Petroleum Industry in Rwanda, highlighted that while Uganda's oil will be a valuable export, the East African region will continue to depend on imported refined products.
"We keep importing unfortunately because that oil will be exported," he asserted, indicating that without local refining capabilities, countries like Rwanda will still look to established markets for their fuel needs.
