$4 billion Hoima refinery awaits key agreements

What the report says

The planned US$4 billion oil refinery at Kabaale in Hoima District is still working toward a Final Investment Decision (FID) targeted for February 2027, according to The Independent Uganda, even as several major agreements and technical preparations remain unfinished. The refinery is designed to process 60,000 barrels of crude oil per day and is part of Uganda’s broader effort to build out its oil industry.

Michael Nkambo Mugerwa of the Uganda Refinery Holding Company told Parliament’s COSASE committee that negotiations are ongoing on the Host Government Agreement, Shareholders’ Agreement, Crude Suppliers’ Agreement and tolling arrangement. He said basic engineering is about 80% complete and the team is reviewing more than 1,000 drawings. If the FID is reached, construction is expected to take three years, with commissioning planned for the first quarter of 2030.

The project is being developed by the government, through the Uganda National Oil Company, and Alpha MBM Investments, a United Arab Emirates-based firm. UNOC officials told MPs the government side must raise about US$1.6 billion for its 40% stake, while Alpha MBM is expected to fund the remaining 60%. The tolling model would allow the government to retain ownership of the crude and the finished products, a structure the company says is central to the deal.

Officials also highlighted a major logistics challenge: transporting refinery vessels that may be more than six metres wide and weigh hundreds of tonnes across Tanzania and Uganda. Environmental, security and pipeline preparations are also underway, but key approvals and financing commitments still need to be finalized before the project can move into construction.