President Yoweri Kaguta Museveni has broken ground for the construction of a 320-million-litre fuel storage terminal in Mpigi district, a project expected to strengthen Uganda’s fuel security and reduce the country’s vulnerability to supply disruptions.

The Kampala Storage Terminal, being developed by the Uganda National Oil Company (UNOC) on 300 acres of land, is estimated to cost USD 250 million. Once completed, it will more than double Uganda’s current petroleum storage capacity of about 160 million litres.

Speaking at the groundbreaking ceremony on Thursday, September 17th, 2026, Museveni said the project was necessary as Uganda expands its petroleum sector and seeks greater control over the supply chain.

“When we took over government in 1986, we tried to hand over the administration of government to the learned technocrats in the ministries. Now, in the Ministry of Energy, with Permanent Secretaries and Commissioners, it took a Senator in Kenya to bring a serious matter to my attention that Uganda was buying petroleum products through middlemen in Kenya. Unbelievable,” President Museveni said.

He noted that the government later introduced measures that reduced the cost of petroleum products, including diesel, petrol and aviation fuel.

“Now that we are moving well on developing our resources, we must plan for storage,” President Museveni noted.

The President, however, cautioned that the new terminal should not be viewed as the final answer to Uganda’s storage needs, saying larger facilities will be required as demand grows.

The UNOC Board Chairman, Mathias Katamba said construction works are ready to begin, with the Engineering, Procurement and Construction contract taking effect on September 18, 2026.

Site works are expected to start immediately, while detailed engineering is scheduled for completion by March 2027. The terminal is expected to be commissioned by September 2028, within 24 months of the contract’s effective date.

The Energy Minister, Dr. Monica Musenero pledged government support for the project but called for better road and railway connections to the terminal to ease the movement of petroleum products.

The Permanent Secretary, Irene Batebe highlighted that the facility will strengthen Uganda’s ability to maintain strategic fuel reserves and respond to disruptions in supply.

Museveni also raised environmental concerns, particularly the dumping of garbage near the terminal. He called for the site to be relocated and urged communities to protect wetlands.

“This is how God made Uganda and we should try to keep it that way. We must find alternative means of dealing with waste. One of the ways is through incineration, which is also a source of electricity,” he said.

The terminal is expected to boost Uganda’s strategic petroleum reserves and improve the distribution of refined fuel to both domestic and regional markets.