Tanzania and Uganda are moving to deepen their energy cooperation, with a new agreement seeking to position Tanga as a regional energy hub—a development that could have far-reaching implications for investment, trade, jobs and energy security in East Africa.
President Samia Suluhu Hassan and Uganda’s President Yoweri Kaguta Museveni witnessed the signing of the agreement at State House in Dar es Salaam on August 6, 2026, following bilateral talks between the two leaders.
The agreement brings together the Tanzania Petroleum Development Corporation (TPDC), Uganda National Oil Company (UNOC) and Vitol Bahrain E.C.
Energy Minister Deogratius Ndejembi said the initiative would leverage Tanga’s strategic location and existing energy infrastructure to develop the city into a regional energy hub.
For Tanzania, the agreement comes at a time when Tanga is already emerging as a critical part of East Africa’s energy infrastructure.
The city is the endpoint of the East African Crude Oil Pipeline (EACOP), which runs from Hoima in Uganda to Chongoleani in Tanga.
The 1,443-kilometre pipeline is designed to transport up to 216,000 barrels of crude oil a day to international markets, giving Tanzania a strategic role in the movement of Uganda’s oil to the coast.
The proposed energy hub could therefore build on infrastructure that is already being developed rather than starting from scratch.
Beyond oil exports
The bigger question for Tanzania, however, is whether the new opportunity can translate into wider economic benefits for citizens.
A regional energy hub should mean more than the storage, handling or transportation of petroleum products.
It should create opportunities for Tanzanian companies to participate in logistics, construction, engineering, transportation, technology, maintenance, professional services and other parts of the energy value chain.
For young Tanzanians, the most important measure of the initiative will ultimately be employment and skills opportunities.
For local businesses, the question will be whether they can access contracts and markets generated by the expanding energy industry.
And for the Government, increased economic activity should translate into higher revenues that can support essential public services such as education, healthcare, water and infrastructure.
This is where the success of the project will be measured.
Strategic location
Tanga’s geographical position gives it an important advantage.
Its access to the Indian Ocean, connection to the EACOP infrastructure and proximity to Uganda and other East African markets provide a foundation for developing a broader energy and logistics ecosystem.
If properly planned, the hub could support activities beyond crude oil, including petroleum storage, transportation, distribution, energy-related industries and other services.
Such development could also stimulate investment in supporting infrastructure and expand business opportunities in Tanga and beyond.
But turning the opportunity into reality will require more than political agreements.
It will require clear investment frameworks, efficient infrastructure, predictable regulations and strong coordination between Tanzania, Uganda and private-sector investors.
Citizens must remain at the centre
The Government will also need to ensure that local communities are not left on the margins of the development process.
Large infrastructure and energy projects inevitably raise concerns over land, the environment, compensation and community participation.
These concerns should be addressed transparently and in accordance with the law.
Environmental protection must remain a priority, while communities hosting major infrastructure should see tangible economic and social benefits.
The involvement of Tanzanian companies should also be strengthened through local-content opportunities, skills development and access to procurement.
This is particularly important if the energy hub is to contribute to Tanzania’s industrialisation ambitions.
A test of regional integration
The Tanzania-Uganda agreement also carries significance beyond the energy sector.
It demonstrates how East African countries can use their geographical advantages collectively.
Uganda has oil resources but is landlocked. Tanzania has access to the Indian Ocean and established links to international markets.
Combining those advantages creates an economic partnership in which both countries can potentially benefit.
It also reinforces the broader objective of regional integration by connecting energy production, transport infrastructure, trade and investment across national borders.
For East Africa, such cooperation could help reduce the cost of moving goods and energy while strengthening the region’s position in international markets.
From agreement to results
President Samia and President Museveni have provided political backing for a project with the potential to influence the region’s energy landscape.
But the real test will come during implementation.
Citizens will want to see jobs created, local businesses participating, skills transferred and new investments coming into the country.
They will also expect transparency on the economic benefits and responsible management of environmental and social impacts.
The signing ceremony is therefore only the beginning.
For Tanzania, the opportunity is to ensure that Tanga does not become merely a transit point for energy destined for international markets, but develops into a centre where value is added, businesses grow and citizens benefit.
If managed effectively, Tanga could emerge as one of East Africa’s important energy and logistics centres.
The Tanzania-Uganda partnership has opened that possibility.
The responsibility now lies with policymakers, investors and other stakeholders to turn the agreement into measurable economic opportunities for the people of Tanzania and Uganda.
The success of the initiative should ultimately be judged not by the size of the agreement, but by the jobs, businesses, investment and public benefits it creates.
