Uganda’s oil sector is advancing steadily as the Tilenga and Kingfisher oil projects near their commercial production targets set for 2025. As of August 2024, 72 out of 457 planned wells have been drilled, with TotalEnergies and CNOOC Uganda Limited spearheading the development.
Energy and Mineral Development Minister Ruth Nankabirwa announced significant progress during a media briefing in Kampala on August 21. She reported that the Tilenga Project, spanning both sides of the Nile, has drilled 63 out of 426 planned wells in Nwoya and Buliisa Districts. In parallel, the Kingfisher Project in Kikuube District has completed nine of the 11 wells needed for its initial phase of production.
Tilenga Project Update:
- Drilling Operations: Work is ongoing on six of the 31 well pads designated for the Tilenga project. Seven well pads are over 85% complete and ready for rig installation. The project has seen the active operation of all three drilling rigs.
- Infrastructure Development: The Tilenga Industrial Area, which will host the Central Processing Facility (CPF), Drilling Support Base, and Construction Camp, is nearing completion at 99.7%. The CPF construction, which includes main pipe racks and foundation bases, is 47.8% complete. The 4,000-person Construction Camp is assembling accommodation units, currently housing around 2,500 people with additional recreational facilities being developed.
- Land Acquisition: Compensation for 99.7% of project-affected persons (PAPs) is complete, with 21 out of 33 PAPs receiving in-kind compensation (land for land), representing 63%.
Kingfisher Project Update:
- Drilling and Construction: Since beginning production well drilling in January 2023, nine out of eleven wells for the Kingfisher Project have been completed. Construction of well pad sites and infield roads is 92% complete, with approximately 1,020 acres of land acquired.
- Central Processing Facility (CPF): The CPF will have a capacity of 40,000 barrels per day, contributing significantly to the project’s output.
Infrastructure Projects:
To achieve its 2025 commercial production goal, Uganda must complete two critical infrastructure projects:
- East African Crude Oil Pipeline (EACOP): The $5 billion EACOP project has seen notable progress since receiving a construction license in 2023. Civil works have commenced at Main Camps and Pipe Yards (MCPYs) in Hoima and Sembabule districts. The Engineering, Procurement, Construction Management, and Commissioning (EPCMC) activities, overseen by Worley and subcontractors ICS Engineering and Norplan, report an overall progress of 39.2%, with detailed engineering surpassing 88.3%. The thermal insulation plant in Nzega District, Tabora region, Tanzania, was completed and commissioned in March 2024.
- Refinery: The $4.5 billion refinery project has faced delays, with ongoing negotiations for key commercial agreements, including the Implementation, Crude Oil Supply, and Shareholders Agreements with Alpha MBM Investments LLC. Progress remains limited, and further developments are awaited.
Both the Tilenga and Kingfisher projects are also focusing on implementing livelihood restoration programs, including transitional and psychosocial support, agricultural improvements, reproductive health services, and vocational training, ensuring that the communities affected by these developments benefit holistically.