Tanzania, Uganda sign pact with Vitol for Tanga energy hub
Tanzania and Uganda signed a non-binding pact with Vitol Bahrain to develop a regional energy hub at Tanga port, with potential infrastructure investments exceeding $20 billion.
The governments of Tanzania and Uganda have signed a non-binding agreement with Vitol Bahrain, a unit of global commodities trader Vitol, to develop a regional energy hub at the Port of Tanga in Tanzania. The pact brings together the Tanzania Petroleum Development Corp, Uganda National Oil Co (UNOC), and Vitol Bahrain.
Specific details on what would be built at Tanga and the associated costs remain unclear. However, Tanzania's government indicated that potential investments in new infrastructure, such as storage facilities, could exceed $20 billion.
Tanga is emerging as a significant energy node, positioned to supply refined products to inland countries like Rwanda. It also serves as the endpoint for the East African Crude Oil Pipeline (EACOP), which will transport crude oil from Uganda to global export markets. Uganda is expected to begin pumping crude later this year.
Vitol Bahrain is the exclusive supplier of petroleum products to Uganda. Last year, it signed a $2 billion deal with UNOC, which helped the company secure a 20.15% stake in Kenya Pipeline Co during its public listing in March.
Uganda imports nearly 95% of its petroleum products, amounting to approximately 2.96 billion litres annually, routed through Kenya via the Port of Mombasa and the Kenya Pipeline Company system.