By Our Staff Reporter

DAR ES SALAAM, TANZANIA — Thursday, 6 August 2026
Uganda and Tanzania have taken a major step towards deepening regional energy cooperation following the signing of a landmark agreement to develop the Tanga Regional Energy Hub, a project expected to strengthen petroleum trade, industrialisation and energy security across East Africa.

The agreement was witnessed by President Yoweri Kaguta Museveni and Tanzanian President Dr. Samia Suluhu Hassan during President Museveni’s two-day working visit to Tanzania.

The Memorandum of Understanding (MoU) was signed between the Uganda National Oil Company (UNOC), Tanzania Petroleum Development Corporation (TPDC) and Vitol Bahrain E.C. to jointly develop the proposed Tanga Regional Energy Hub.

The project will build on the East African Crude Oil Pipeline (EACOP) and is expected to position Tanga as a major regional centre for petroleum storage, refining, logistics, trading and distribution.

The two Heads of State also held a tête-à-tête at State House in Dar es Salaam, where they discussed bilateral relations and areas of mutual interest before witnessing the signing ceremony.

Energy partnership to drive industrialisation

Uganda’s Minister of Energy and Mineral Development, Dr. Monica Musenero, described the agreement as a significant demonstration of the two countries’ commitment to regional integration and economic transformation.

She said the partnership goes beyond the construction of energy infrastructure, arguing that it will create opportunities for industrialisation, employment and increased regional trade.

“These are not merely infrastructure projects. They are strategic investments that will create jobs for our young people, deepen regional trade and strengthen the logistics systems that support our economies,” Musenero said.

She further stressed that Uganda wants to maximise the value of its petroleum resources by developing downstream industries instead of relying solely on the export of raw commodities.

According to Musenero, the development of petroleum-related industries will create opportunities for highly skilled employment in engineering, operations, maintenance, laboratory analysis and management.

Tanga hub and Hoima refinery to complement each other

The minister also clarified that Uganda’s planned 60,000-barrel-per-day Hoima refinery will complement rather than compete with the Tanga Regional Energy Hub.

She said the two projects are expected to work together to strengthen regional energy security while enabling East African countries to retain more value from their petroleum resources.

Feasibility and front-end engineering design studies for a proposed refined petroleum products pipeline and storage terminal are progressing, with completion expected later this year.

Studies for a proposed natural gas pipeline linking Uganda and Tanzania are also at an advanced stage and are expected to be concluded by October 2026.

Electricity cooperation also on the agenda

The growing energy partnership extends beyond petroleum.

Musenero revealed that Uganda has made progress on the proposed Uganda–Tanzania 400kV electricity interconnector.

She said Uganda concluded negotiations with the World Bank in March and subsequently secured US$250 million in financing in June for its section of the project.

The interconnector is expected to increase electricity exchange between Uganda and Tanzania, strengthen the Eastern Africa Power Pool and create opportunities for expanded electricity trade with countries in Southern Africa.

Tanzania backs Uganda’s refinery plans

Tanzania’s Minister of Energy, Hon. Deo Ndejembi, described the signing of the agreement as another historic milestone in the energy relationship between the two countries.

He said the cooperation did not begin with the latest agreement, but was built over several years, particularly through the development of EACOP.

According to Ndejembi, EACOP created the foundation for deeper regional cooperation, while the Tanga Regional Energy Hub represents the next phase by focusing on value addition through refining, storage, logistics, trading and industrialisation.

“EACOP transports molecules. The Tanga Regional Energy Hub transforms those molecules into prosperity,” Ndejembi said.

He said the proposed hub has the potential to attract investments exceeding US$20 billion, making it one of the largest integrated energy infrastructure developments in Sub-Saharan Africa.

Ndejembi also dismissed concerns that Tanzania’s proposed energy hub could undermine Uganda’s refinery ambitions, saying Tanzania supports Uganda’s objective of adding value to its petroleum resources through domestic refining and industrial development.

Bidirectional pipeline to expand regional trade

The Tanzanian minister said a proposed bidirectional multi-product pipeline linking Uganda and Tanzania would allow refined petroleum products to move in either direction depending on market demand.

The arrangement, he said, could open wider export opportunities for Uganda while strengthening fuel security across East Africa.

The emerging energy cooperation is therefore expected to create a more integrated regional energy market, attract private-sector investment and support job creation.

Both countries believe their experience in delivering EACOP demonstrates their capacity to implement complex cross-border infrastructure projects and could encourage further investment in regional energy and industrial projects.

The latest agreement marks a new phase in Uganda-Tanzania relations, shifting cooperation from crude oil transportation towards broader value addition, energy trading and industrial development.

President Samia later hosted President Museveni to a state luncheon in honour of his visit, further underscoring the close relations between the two neighbouring countries.

The two governments are now expected to advance the technical and feasibility studies required to turn the proposed energy projects into operational infrastructure, potentially reshaping the region’s petroleum and electricity trade in the years ahead.