Oil is one of the most valuable resources. For a country like Uganda, which is one of the least developed countries in the world with more than one third of the population still living below the poverty line; the discovery of this valuable resource has the capacity to radically alter the economy of the country. But on the other hand, oil exploration, mining and refining are complex, costly, long duration projects with many challenges that require sophisticated financial management, planning, scheduling and cost control. The project management profession is charged as a single point of responsibility for initiating, planning, executing, monitoring and controlling projects in order to meet stakeholder’s needs and expectations. The research objectives were: 1. To identify and examine the challenges and risks associated with the oil industry in Uganda. 2. To investigate the effectiveness of project management practices in the Ugandan oil industry in terms 1 above. 3. Identify how project success can be measured in the Ugandan oil industry. A case study was the research technique adopted and interviews were conducted with the major stakeholders in the Ugandan oil industry. The research findings reveal the challenges and risks that continue to plague the Ugandan oil industry and the role of project management in the exploration phase of the project. The research findings were used to evaluate the role, responsibility and service that project management professionals are expected to render and the actual role, responsibility and service that the professionals have been rendering to the stakeholders in the Ugandan oil industry. The research then concludes by proposing ways of improving the chances of project success in the Ugandan oil industry.