In a critical display of regional cooperation and strategic foresight, the Uganda National Oil Company (UNOC) and Kenya Pipeline Company Limited (KPC) on Tuesday convened a vital meeting with Oil Marketing Companies (OMCs) in Kampala.
This gathering, held at the Mestil Hotel, served as a crucial platform to provide updates, gather feedback, and address queries regarding UNOC’s pivotal role as the sole importer of fuel products into Uganda.
The discussions underscored the profound importance of a stable and efficient fuel supply for Uganda’s economic functionality and future growth.
Proscovia Nabbanja, the UNOC Chief Executive Officer, noted that the decision for UNOC to become the sole importer of petroleum products, which became fully operational in 2024, was a landmark move aimed at streamlining Uganda’s fuel supply chain, enhancing security of supply, and stabilising pump prices by cutting out middlemen.
This strategic shift, she pointed out, has already demonstrated tangible benefits, with reports indicating more consistent and reliable fuel availability and reduced price volatility in the Ugandan market.
She highlighted the significant scale of UNOC’s operations, disclosing that the company currently serves 103 OMCs and has facilitated the importation of over 2.6 billion litres of fuel products via the Kenyan pipeline infrastructure.
“In the effort to ensure constant availability, UNOC and Kenya pipeline will collaborate on the Eldoret-Kampala pipeline, under the government’s directive, according to the UNOC CEO,” Nabbanja said.
Nabbanja further reiterated UNOC’s unwavering commitment to serving OMCs diligently, ensuring their needs are met efficiently.
She explained that this project, which aims to extend the existing Kenyan pipeline further into Uganda, is poised to be a game-changer for regional energy security.
Currently, a significant portion of Uganda’s fuel is transported from Eldoret, Kenya, by trucks or via Lake Victoria after being piped to Kisumu.
Partnership for Prosperity
Mathias Katamba, the UNOC Board Chairman, lauded both the OMCs and KPC for their instrumental roles in ensuring the continuous availability of fuel in Uganda. He specifically appreciated KPC for its robust infrastructure and expertise, acknowledging its vital contribution to the steady supply that keeps Uganda functional.
He noted that reliable and affordable fuel is the lifeblood of any modern economy, powering transport, agriculture, industry, and essential services.
Katamba explained that Uganda’s growing economy, with a 2023 GDP of approximately USD48.7 billion and a rapidly increasing demand for energy, which heavily relies on a consistent influx of petroleum products.
Joe Sang, the Managing Director of Kenya Pipeline Company Limited, reinforced this collaborative spirit. He stated that KPC is actively enhancing its capacity, particularly in Western Kenya.
This includes commissioning new pump stations and upgrading existing infrastructure to boost flow rates. These enhancements, according to Sang, are designed to ensure greater efficiency and optimal supplies not just for Kenya but also for its landlocked neighbours like Uganda, Rwanda, South Sudan, and the Democratic Republic of Congo (DRC), which heavily rely on KPC’s network.
Driving Economic Growth
The robust collaboration between UNOC and KPC, coupled with UNOC’s sole importation mandate, is set to drive significant economic benefits for Uganda:
Enhanced Energy Security and Price Stability
A steady and reliable supply of fuel, directly managed by UNOC and supported by improved infrastructure, minimises the risks of shortages and price volatility. This predictability allows businesses to plan better, reduces operational costs, and translates into more stable pump prices for consumers, directly impacting inflation and household budgets.
Reduced Costs and Increased Efficiency
By streamlining the import process and potentially transitioning to pipeline transportation, the elimination of middlemen and reduced reliance on costly and environmentally impactful road transport will lead to lower overall logistics costs, which can ultimately be passed on to consumers.
Boost to Local Businesses
UNOC’s direct engagement with 103 OMCs fosters a more transparent and competitive local market. Furthermore, the increased volume of fuel handled creates opportunities for local transporters, clearing and forwarding agents, and other ancillary service providers, stimulating job creation and local expertise within the petroleum sector.
Strengthening Regional Integration
The collaboration on infrastructure projects like the Eldoret-Kampala pipeline solidifies regional ties and creates a more resilient East African energy corridor. This facilitates trade and economic cooperation, positioning Uganda as a key player in the regional energy landscape.
Foundation for Future Development
A secure and affordable fuel supply is fundamental to supporting Uganda’s ambitious development agenda, including industrialisation, agricultural modernisation, and infrastructure development.
As Uganda prepares for its crude oil production, UNOC’s experience in managing petroleum imports and the strengthened supply chain will be invaluable.
The strategic partnership between UNOC and KPC is thus laying a solid foundation for Uganda’s energy independence and long-term economic prosperity.
By ensuring a consistent and efficient supply of fuel, they are powering the nation’s progress and building a more resilient economic future.