Uganda National Oil Company (Unoc) signed sales and purchase agreements (SPAs) with the largest fuel dealers in the market on Tuesday, as it continues to recover from the setbacks associated with the route in Kenya that threatened its monopoly on fuel supply. These agreements will permanently bind over 80 Ugandan oil marketers to the state-owned company.

This comes after the Ugandan, Kenyan, and Unoc governments recently signed a tripartite agreement at the State House in Nairobi. According to officials, the first products should be available next month.

The SPAs define the roles and obligations of each link in the supply chain and provide a formal agreement between Unoc, the supplier, and the oil marketing corporations (OMCs), the buyers of bulk petroleum products.

“The agreements with our clients, the OMCs have been completed and so what remains is delivering the vessel/products and the products hitting the fuel pumps,” said Peter Muliisa, Unoc’s Chief Legal Company Secretary.

“With the signing, everything is now set,” said Mr Muliisa. “What remains now is to bring in the first vessel to start delivering the fuel. We expect the first ship under Unoc will be here in July.”

At the Kampala Serena Hotel, five businesses, including Vivo Energy, Moil, Rock Global Oils, Petro City, and Nile Energy, signed agreements with Unoc. On Wednesday, additional businesses are anticipated to sign agreements, which will generate billions of dollars in revenue for the single supplier.

Proscovia Nabbanja, the chief executive officer of Unoc, and Mr. Muliisa signed on behalf of the business, while representatives of the OMCs signed on behalf of their individual enterprises.

In addition to being the only supplier, Unoc will play a significant role in the transportation of petroleum products into Uganda, running the oil barges and vessels that are anticipated to be added to the company’s inventory, a development that will cement its dominance in the sector.

According to Mr. Muliisa, Unoc will need a new vessel each month to transport enough gasoline to meet the market demand, which is now seven million liters per day, given the growth expectations of the downstream part of the business.

The market has been expanding at a rate of seven to nine per cent annually, but within the next five years, it is anticipated to reach a peak of nine to eleven percent. Out of the more than 100 OMCs in Uganda, Unoc has established agreements with at least 83 dealers, or large to medium operations. The smaller and micro dealers will still purchase goods from the industry’s titans.