Uganda Grants Expanded Regulatory Powers to Petroleum Authority Under New Policy

Uganda is embarking on a transformative phase in its oil and gas industry with the introduction of the National Petroleum Policy 2025. This landmark policy, launched by Deputy Speaker Thomas Tayebwa, signals a strategic shift towards maximizing the value derived from the nation's crude oil resources. The policy's overarching goal is to ensure the "sustainable exploitation and utilization of Uganda's petroleum resources" in a way that fosters "in-country value addition, equitable socio-economic development, and safeguards the environment."

A key feature of this new policy is the significant empowerment of the Petroleum Authority of Uganda (PAU). For years, the PAU has effectively managed the upstream (exploration, drilling, production) and midstream (transportation, storage, initial processing) segments. However, the 2025 policy extends its mandate to encompass the downstream sector – refining, distribution, marketing, and retail of petroleum products. This consolidation under a single regulator aims to eliminate existing oversight gaps and ensure a more cohesive and comprehensive regulatory environment.

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To sustainably exploit and utilize Uganda's petroleum resources in a manner that maximizes in-country value addition, fosters equitable socio-economic development, and safeguards the environment.

This move represents a departure from the previous structure, where the Ministry of Energy and Mineral Development, guided by the Petroleum Supply Act of 1994, oversaw downstream operations. By bringing all facets of the petroleum value chain under the PAU, Uganda seeks to streamline operations, enhance efficiency, and ensure that the benefits of its oil wealth are realized more effectively across the country. This integrated approach is expected to attract further investment and foster robust growth in the sector.

The policy's emphasis on "in-country value addition" is particularly significant for Uganda. It reflects a national aspiration to move beyond simply extracting raw resources and instead develop local capacity in refining, processing, and related industries. This strategy is crucial for job creation, technological transfer, and ensuring that the oil sector contributes meaningfully to broader socio-economic development, aligning with the goal of poverty eradication and creating lasting societal value, as envisioned in the successor policy to the 2008 framework.

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The new oil and gas policy places regulation of the entire petroleum value chain under a single regulator. As a result, the Petroleum Authority of Uganda will now regulate downstream activities, including operations such as petrol stations, among others.