The oil and gas industry has been forecast to lead economic growth in Uganda, if favourable policies and structure are implemented. According to World Bank, the economic outlook of Uganda is set to increase steadily with the oil infrastructure and other management schemes put in place that could propel a better economy.
In Uganda, the oil and gas industry has been pivotal in determining the prices of commodities in the international market. It has also been responsible for the strength and weakness of the currency as the rise and fall of oil price reflect on investments in agricultural produce as well as the progress of capital markets.
The oil and gas sector is a promising sector with a huge potential to contribute enough revenue that can boost the country’s GDP should Uganda have a better economic outlook, noted the World Bank. With the discovery of oil basins, more exploration is set to take place in the East African country, thereby increasing production output. Uganda’s commercial oil production have largely been hindered by poor infrastructure.
In April, Uganda signed a deal with Albertine Graben Refinery Company (AGRC), a consortium of international oil companies led by America’s General Electric Co., to build and operate its first oil refinery in Hoima district in Western Uganda, after two unsuccessful attempts at signing a deal.
More exploration is set to take place with discovery of oil basins that will increase the barrels of oil produces. The establishment of oil companies in the country is a sign of the readiness of the companies to harness the natural resource and this will potentially boost growth in the sector.
Uganda first confirmed the existence of commercially viable petroleum reserves in 2016 and it is estimated to have about 6.5 billion barrels of oil deposits with an estimate of between 1.4 and 1.7 billion barrels recoverable.