President William Ruto has announced that the Kenyan government is set to invest in Uganda’s planned oil refinery project, marking a new phase in regional energy cooperation between the two East African neighbours.
Speaking on Thursday at the Africa We Build Summit 2026 in Nairobi, Ruto said Kenya was ready to strengthen economic integration with Uganda, particularly in the petroleum sector, following what he described as growing mutual trust through cross-border investment.
“Mzee, I want to assure you that the same way you invested in Kenya Pipeline, Kenya is going to invest in your refinery and the future of our resources together,” Ruto said.
The Ugandan refinery project in Hoima is estimated to cost about USD 4 billion, roughly KSh 500 billion, and is expected to become one of the biggest industrial energy investments in the region.
Uganda’s President Yoweri Museveni welcomed the proposal, describing it as a positive step toward maximising value addition from the region’s untapped oil resources.
The announcement comes only weeks after Treasury Cabinet Secretary John Mbadi confirmed that the privatisation of the Kenya Pipeline Company (KPC) through an Initial Public Offering raised KSh106.7 billion, with strong participation from local and regional investors.
According to the Treasury, Kenyan investors acquired 7.9 billion shares, while investors from neighbouring countries, led by Uganda and Rwanda, bought around 3.8 billion shares. The strong uptake reflected growing interest in strategic infrastructure within the East African Community.
Mbadi said Uganda and Rwanda showed particularly strong appetite for the IPO, with Rwandan pension funds among the major institutional investors. Uganda had initially sought a larger stake, but some allocations were reduced because of oversubscription.
Despite the regional interest, the Kenyan government retained a 35 per cent controlling stake in KPC, while the East African Community bloc now holds about 21.22 per cent of the company.
The development also comes as Kenya steps up its own oil ambitions, with progress on the South Lokichar Basin project in Turkana County. The government expects the first oil production by December 2026.
The project received a boost after Kenya acquired a KSh1.9 billion drilling rig from the United Arab Emirates, with Gulf Energy E&P BV taking over operations following Tullow Oil’s exit from the basin.
Treasury estimates that South Lokichar could produce up to 585 million barrels of recoverable reserves, potentially generating about KSh135 billion in government revenue once commercial production begins.
The planned investment in Uganda’s refinery, combined with Kenya’s own upstream oil push, signals a broader regional effort to build a more integrated and self-sustaining energy sector across East Africa.
