Uganda and Tanzania have secured external financing for the construction of the East African Crude Oil Pipeline (EACOP), marking a significant step toward the realization of the project.
According to a statement issued by EACOP Ltd, the funding comes from a syndicate of financial institutions, including KCB Bank Uganda, the Islamic Corporation for the Development of the Private Sector (ICD), the African Export-Import Bank (Afreximbank), and the Standard Bank of South Africa, the parent company of Stanbic Bank Uganda.
However, the statement did not disclose the exact amount contributed by each lender. The Ugandan Ministry of Energy estimates that the pipeline’s construction will cost approximately $4 billion (about Shs 15 trillion).
EACOP’s shareholders include affiliates of the three upstream joint venture partners: the Uganda National Oil Company (UNOC), TotalEnergies E&P Uganda, and CNOOC Uganda, alongside the Tanzania Petroleum Development Corporation (TPDC).
The ownership structure is as follows: TotalEnergies holds the majority stake at 62%, while UNOC and TPDC each own 15%, and CNOOC holds an 8% share. The pipeline is being constructed alongside two major upstream oil development projects—Tilenga, operated by TotalEnergies, and Kingfisher, operated by CNOOC.
Uganda’s Minister of Energy and Mineral Development, Ruth Nankabirwa, previously stated that the project was initially planned to be financed through a 40:60 equity-to-debt ratio. However, she later announced a revised financing arrangement of 52:48. At the time, she noted that the government was seeking $1.2 billion for the EACOP project. According to the statement, the project overall progress is over 50 per cent.
The 1,443km (296km in Uganda and 1,147km in Tanzania) pipeline will transport Uganda’s crude oil from Kabaale-Hoima to Chongoleani peninsula in Tanga, Tanzania, for export to the international market. It will have the capacity to transport 246,000 barrels of crude oil per day
Where will Uganda & Tanzania seel the Crude Oil?
Developed well governed lands are investing in Clean Energy as part of protection of climate that is now a threat to the entire world!
When will Africa have real LEADERS to ensure Good Governance to begin to protect nature, humans…before it’s too late?
The refinery takes crude away from EACOP. Throughput will decline by a quarter if the refinery takes off. Nobody seems to see this obvious point.