Written By Lisa Murimi
Uganda’s recent drive in the oil sector, marked by the drilling of 74 new wells in the Tilenga and Kingfisher regions, signals a significant shift in East Africa’s energy landscape.
With commercial oil production slated for next year, Uganda’s burgeoning oil industry could have profound implications for Kenya.
For years, Kenya has been Uganda’s primary gateway for importing petroleum products, a trade valued at approximately $2 billion annually.
The Mombasa port, managed by the Kenya Pipeline Company (KPC), has been pivotal in this exchange, supporting a vital economic relationship between the two nations.
Uganda’s intensified oil drilling, announced by Energy Minister Ruth Nankabirwa, shows the country’s ambitions to harness its vast oil reserves.
The ongoing construction of Uganda’s refinery and the East African Crude Oil Pipeline (EACOP) may alter regional trade dynamics, potentially impacting Kenya’s oil sector.
Uganda’s oil boom could also present significant advantages for Kenya.
With Uganda’s oil refinery project still under development, the Mombasa port continues to be a key hub for the landlocked country’s oil exports, reinforcing Kenya’s strategic importance in the region.
A recent agreement between Nairobi and Kampala is poised to further enhance Kenya’s role in the oil supply chain, by extending the oil pipeline from Eldoret to Uganda, it enables Kampala to import refined petroleum products directly through Nairobi.
This move is expected to deepen the trade relations between the two countries, with potential economic benefits for both.
President William Ruto highlighted the importance of this agreement, noting that it addresses previous logistical challenges faced by Uganda, predicting that it will not only bolster Uganda’s oil industry but also strengthen the economic ties between the two nations.
This development could see Kenya playing an even more crucial role in East Africa’s evolving energy landscape.
