Tanzania, Uganda Sign MoU for USD 20 Billion Tanga Energy Hub

Tanzania and Uganda have signed a Memorandum of Understanding on proposals to develop Tanga as a Regional Energy Hub, in a deal Tanzania’s Minister for Energy said could attract investment exceeding USD 20 billion.

The agreement was signed at State House in Dar es Salaam on 6 August 2026, during an official visit by Ugandan President Yoweri Museveni hosted by President Samia Suluhu Hassan.

The Memorandum of Understanding was signed by the Uganda National Oil Company (UNOC), the Tanzania Petroleum Development Corporation (TPDC), and global energy trader Vitol Bahrain E.C.

It provides for the development of petroleum storage, refining, logistics, trading, and distribution infrastructure at the port city of Tanga, building on the foundation established by the East African Crude Oil Pipeline (EACOP).

The proposed hub is expected to complement Uganda’s own 60,000-barrel-per-day Hoima refinery, improving fuel security and opening new export routes across East and Central Africa as Uganda prepares to start oil production before the end of 2026.

Vitol is already a partner in Uganda’s petroleum sector through a seven-year agreement with UNOC backed by financing of up to USD 2 billion for petroleum storage, terminals, pipelines, and related logistics, and its involvement in the Tanga hub extends that partnership into a wider regional network.

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

Uganda has separately secured USD 250 million in World Bank financing for its section of a planned 400-kilovolt electricity interconnector with Tanzania, a line expected to expand electricity trade and strengthen the Eastern Africa Power Pool.

Tanzania’s Minister for Energy, Deogratius Ndejembi, said the agreement built on the foundation established by EACOP and represented a shift towards refining, storage, logistics, and industrial development.

“EACOP transports molecules. The Tanga Regional Energy Hub transforms those molecules into prosperity,” Ndejembi said, adding that Uganda’s Hoima refinery would complement rather than compete with the Tanga development.

For his part, the Minister of Energy and Mineral Development of Uganda, Monica Musenero Masanza, described the signing as another step in the two countries’ strategy to use petroleum resources to support industrialisation rather than merely export raw commodities.

“Action speaks louder than words, and today we are privileged to witness a giant step towards joint development with our sister nation,” Musenero Masanza said.

Tanga Region

Tanga is a coastal region in northeastern Tanzania on the Indian Ocean, bordering Kenya, with a population of approximately 2.6 million people according to the 2022 census.

The region is home to the Port of Tanga, the country’s second-largest port, historically used for bulk cargo including coal and cement, and connected to Dar es Salaam and the Kenyan border by road, rail, and air.

Tanga has attracted a growing wave of energy infrastructure investment in recent years, including the Chongoleani Marine Terminal built for EACOP and the USD 100 million Tanga LPG Terminal launched in June 2025 to serve as a regional liquefied petroleum gas hub.

The East African Crude Oil Pipeline runs 1,443 kilometres from Hoima in western Uganda to Tanga and is designed to transport up to 230,000 barrels of oil per day, at a cost of roughly USD 5 billion.

Tanzania’s Minister for Energy said in June 2026 that EACOP construction had reached 86% completion, with the first crude oil shipment from the Chongoleani Marine Terminal now expected in January 2027.