Kenya, Uganda commit $2B to joint oil refinery in Tanzania under East Africa trade bloc

Kenya and Uganda committed $2 billion to a joint $4.3 billion oil refinery project in Kabaale, Hoima district, Tanzania, officials said Wednesday. The investment, part of the Albertine Graben Refinery Consortium led by RT Global Resources, aims to boost regional oil processing capacity and strengthen economic integration under the East African trade bloc.

The Albertine Graben Refinery Consortium, led by RT Global Resources, will build and operate the refinery with a planned processing capacity of 60,000 barrels per day, officials said. RT Global Resources is proposed to hold a 60% stake in the refinery, while Uganda will retain 40%, which it will share with neighboring East African countries, according to a statement from Uganda’s government.

The $4.3 billion project is located in Kabaale, Hoima district, Tanzania, and is designed to enhance the region’s oil processing capabilities.

Kenya and Tanzania have confirmed their stakes in the project, with Kenya committing $54 million for a 2.5% share and Tanzania investing $150.4 million for an 8% stake, officials confirmed. Uganda’s 40% share will also be distributed among Kenya, Tanzania, Rwanda, and Burundi, aligning with the regional integration goals under the East African Community trade bloc. The consortium was selected in early August following a competitive bidding process that involved 40 other contenders, according to Uganda’s Ministry of Energy.

The consortium includes international partners such as U.S.-based General Electric, Italy’s Saipem SpA, and India’s Yaatra Ventures LLC, records show. The refinery project follows the May 26 signing of the $3.5 billion East African Crude Oil Pipeline Project between Uganda and Tanzania, which will transport crude oil from Uganda’s oil fields to the Tanzanian coast for export, officials said.

Uganda’s crude oil reserves are estimated at 6.5 billion barrels, with 800 million barrels confirmed to date and valued at approximately $50 billion, according to data from Uganda’s Ministry of Energy and Mineral Development. The oil reserves are primarily developed by Total SA of France, Tullow Oil Plc of the United Kingdom, and China’s CNOOC Ltd. The refinery is expected to process crude oil from these reserves, generating an estimated $2 billion in annual revenue for Uganda, sources confirmed.

The financing model proposed by the Albertine Graben Refinery Consortium aims to ensure the refinery’s commercial viability while benefiting Uganda and the broader East African region, according to consortium representatives. The refinery’s development is part of a broader strategy to boost regional energy infrastructure and economic integration under the East African Community framework.

The project timeline includes the consortium selection in early August, shortly after the pipeline agreement was signed in May. The refinery is expected to complement the pipeline by providing downstream processing capacity, reducing reliance on imported refined petroleum products, and creating economic opportunities across member states, officials said.

Neighboring countries’ participation through equity stakes reflects a commitment to regional cooperation in the energy sector. Kenya, Tanzania, Rwanda, and Burundi’s involvement aligns with the East African Community’s objectives to foster cross-border investments and infrastructure development. The refinery’s location in Tanzania’s Hoima district is strategic for accessing crude oil reserves in Uganda’s Albertine Graben region and facilitating export logistics.

The Albertine Graben Refinery Consortium’s selection followed a rigorous evaluation process to identify a partner capable of delivering a commercially viable refinery project. The consortium’s international composition brings technical expertise and financial capacity critical to the project’s success, according to Uganda’s Ministry of Energy.

The refinery project forms part of a larger regional energy development plan that includes the East African Crude Oil Pipeline and other infrastructure initiatives aimed at harnessing the region’s oil resources for economic growth. Officials have indicated that the project will proceed in phases, with construction timelines and further financing arrangements to be announced as the consortium advances planning and development activities.