Uganda has secured the much needed financial impetus for the construction of a US$4 billion oil refinery, a move that president Yoweri Museveni calls a “milestone in the commercialisation of the country recent oil discoveries.”
Mr Museveni said that an agreement has been signed with a consortium of American and Italian firms to finance and construct the facility in the western Hoima district.
He said that the agreement received further support from African Legal Support Facility (ALSF).
“The agreement establishes critical terms and conditions for the oil refinery’s development and represents an important milestone in the commercialization of Uganda’s natural resource endowments,” said Mr Museveni.
He added,“This agreement is a key step towards the construction of the oil refinery in Hoima District since it ensures development, design, financing, construction, operation and maintenance of the facility.”
The oil refinery is expected to have a 60 000 barrels-per-day processing capacity, and is expected to intensify production shortly after the facility’s inauguration.
Ever since commercially viable hydrocarbon deposits were discovered in Uganda in 2006, the Government of Uganda has launched a development strategy which seeks to translate their presence into regional development and inclusive economic growth.
Last month the country moved its mineral licensing system online to enhance service delivery and boost data accuracy.
Uganda is in the process of reorganizing its fledgling mineral industry which it sees as a potential foreign exchange earner.
In 2014, the country completed a $75m national mineral survey to generate useful geological data and help attract investors. The survey showed that the country has substantial gold deposits.
According to the US Department of Commerce,Uganda’s gold reserves support scores of artisanal small-scale mining (ASM) operations that collectively employs 200,000 people.