Uganda's national oil firm just locked down a huge loan for fuel infrastructure. The Uganda National Oil Company, or UNOC, signed deals for up to two billion dollars with Vitol Bahrain. This follows a parliamentary vote letting the company borrow the money over seven years. The cash is for a bunch of big projects like new fuel storage tanks at Namwabula in the Mpigi district, making the Jinja terminal bigger, and extending a pipeline from Kenya into Uganda. It also covers work related to a future oil refinery and other logistics stuff.
This move is a direct play to cut the country's massive fuel import bill. Uganda brings in over 2.3 billion liters of petroleum products every year, almost all of it coming through Kenya's port. That costs them around two billion dollars annually in foreign exchange. Officials think building their own storage and pipeline networks will lower transport costs, make supplies more secure, and reduce losses. The country's fuel demand keeps rising each year. UNOC said this financing boosts energy security and helps position Uganda as a regional hub for petroleum.
The loan also solidifies UNOC's central role in the sector, from supplying products to building infrastructure. This is part of a bigger picture where Uganda is sitting on sizable crude oil reserves and aiming for its first oil production later this decade through the Tilenga and Kingfisher projects and the East African Crude Oil Pipeline. The government statement promised strict oversight on how all this borrowed money gets spent. These agreements are a major step in a long-term plan to grow the economy by focusing on energy and regional logistics.
This move is a direct play to cut the country's massive fuel import bill. Uganda brings in over 2.3 billion liters of petroleum products every year, almost all of it coming through Kenya's port. That costs them around two billion dollars annually in foreign exchange. Officials think building their own storage and pipeline networks will lower transport costs, make supplies more secure, and reduce losses. The country's fuel demand keeps rising each year. UNOC said this financing boosts energy security and helps position Uganda as a regional hub for petroleum.
The loan also solidifies UNOC's central role in the sector, from supplying products to building infrastructure. This is part of a bigger picture where Uganda is sitting on sizable crude oil reserves and aiming for its first oil production later this decade through the Tilenga and Kingfisher projects and the East African Crude Oil Pipeline. The government statement promised strict oversight on how all this borrowed money gets spent. These agreements are a major step in a long-term plan to grow the economy by focusing on energy and regional logistics.
