Government has allocated Shs 875.8 billion for mineral-based industrial development in the 2025/26 financial year.
Accordingly, a significant portion of the funds is directed towards advancing the oil and gas sector.
The announcement was made by Finance Minister Matia Kasaija during the presentation of the National Budget on Tuesday at Kololo Ceremonial Grounds.
“I have provided Shs 875.8 billion next financial year for mineral-based industrial development including oil and gas,” Kasaija stated.
He elaborated that the funding would support key strategic areas such as: continued quantification of mineral resources, starting with iron ore, gold and copper, and strengthening their tracking system, capitalisation of the Uganda National Mining Company, establishing mineral markets and buying centres to enable transparent mineral trading.
He added that the funds will target expediting finalisation of the East African Crude Oil Pipeline (EACOP), and prioritisation of the construction of the oil refinery and refined products pipeline, among others.
Among the notable developments in the oil and gas sector this financial year, the Minister highlighted that the Tilenga and Kingfisher oil projects remain on track to deliver first oil in 2026.
It should be remembered that, a deal was signed between Alpha MBM from the United Arab Emirates and the Uganda National Oil Company (UNOC) to construct a 60,000 barrels-per-day oil refinery, set to spark growth in Uganda’s petrochemical industry.
“Once operations start, the oil and gas sector will contribute between USD 1 and 2.5 billion annually to the country's revenues,” Kasaija said. This translates to approximately Shs 3.9 trillion to Shs 9.7 trillion annually at current exchange rates.
He added that in terms of local content, Ugandan firms have increasingly benefited from oil sector contracts.
“Out of 5,693 Tier One contracts, amounting to a total value of USD 5.4 billion awarded to date, 4,796 contracts (84 percent) were to Ugandan companies, amounting to USD 2.25 billion,” the Minister revealed.
"That’s about Shs 21 trillion worth of contracts, with Ugandan companies accounting for Shs 8.1 trillion,"
He also noted that approximately Shs 121 billion (USD 33.4 million) has been spent in the Bunyoro region alone on locally sourced goods and services.
Figures by the minister further show that employment has significantly increased, with more than 14,000 Ugandans trained in technical fields, and a total of 17,000 direct and 39,567 indirect jobs created in the oil and gas industry.
Kasaija also noted that infrastructure progress has also been critical, highlighting that Kabalega International Airport, a key enabler for oil logistics, is nearly complete.
Additionally, more than 700 kilometres of roads have been constructed in the Albertine Region to support commercial oil production.
Kasaija further reported progress on the East African Crude Oil Pipeline, which is 58 percent complete overall.
“Engineering works [are] at 98 percent completion and procurement of the major equipment for the pipeline at 83 percent,” he said.
Since August 2024, Uganda has seen a stabilisation in fuel supply and prices following UNOC’s entry into the bulk supply of petroleum products.
“This has been realised due to the elimination of middlemen and speculative tendencies,” Kasaija said. As a result, the country now saves up to USD 72.8 million (about Shs 282 billion) annually on fuel imports.
The 2025/26 budget was unveiled under the theme: “Full monetisation of Uganda’s economy through commercial agriculture, industrialisation, expanding and broadening services, digital transformation and market access.”