Uganda National Oil Company (UNOC) is close to signing Front-End Engineering Design (FEED) contracts for a $4bn oil refinery in Hoima District, local outlet the Daily Monitor reported.

Technical studies are expected to begin before the end of 2025, with early works, including an access road from Nyamasoga to the site and perimeter fencing installation. It is expected to take three years to build. 

UNOC is working on an Environmental and Social Impact Assessment (ESIA) for the refinery and preparing to operationalise a dedicated project vehicle, Kabaale Refinery Company Limited, a joint venture in which UNOC will hold a 40% stake and private partners the remaining 60%. Alpha MBM Investments (UAE) is the agreed strategic investor.

“We expect the company to be fully incorporated and operational within the week,” said Felix Okot, UNOC head of refinery development, as quoted by the Daily Monitor. 

The planned facility will process 60,000 barrels per day (bpd). UNOC is negotiating crude oil supply with CNOOC Uganda Limited and TotalEnergies EP Uganda. A 211-kilometre products pipeline is planned to link the refinery in Kabaale to a storage terminal in Mpigi District.

Uganda signed a Refinery Implementation Agreement with Alpha MBM Investments on March 29 after the Albertine Graben Energy Consortium (AGEC) withdrew from the project, as bne IntelliNews reported.

The refinery marks a key step in Uganda’s drive to strengthen energy security. According to UNOC, the country consumes about 6.0mn–6.5mn litres of refined fuel daily, with around 90% imported, costing about $2.02bn in 2023. By producing 60,000 bpd domestically, the project aims to reduce imports, boost industrial capacity, and position Uganda as a regional refining hub.

Construction at the Kingfisher Development Area’s Central Processing Facility (CPF) is nearing completion, according to statements by Alex Nyombi, director for development and production at the Petroleum Authority of Uganda (PAU).

Kabalega International Airport, a key logistics hub for the refinery, is 96% complete, SBC Uganda Limited public relations officer Amos Muriisa confirmed.

Separately, as bne IntelliNews reported, UNOC is seeking a joint venture partner to develop the Kasuruban exploration block, a 1,285-square-kilometre area in western Uganda awarded to the state-owned company in 2023 under a production sharing agreement (PSA) with the government. The PSA, initially valid for two years, was renewed in March, and UNOC is preparing for exploration.