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Tanzanian delegation in Uganda for oil pipeline negotiations

Ugandan and Tanzanian officials are meeting in Kampala for another round of negotiations on the host government agreement for the East Africa Crude Oil Pipeline.

Sources at the Energy ministry have indicated that at least four ministers from Tanzania are already in Uganda for the ministerial meeting to be held at Kampala Serena hotel. The team includes Dr Adelardus Kilangi, Tanzania's attorney general. 

Uganda Energy ministry permanent secretary, Robert Kasande confirmed the arrival of the Tanzania delegation but was hesitant to divulge details about the meeting that could set off the construction of the $4bn project.

Uganda and Tanzania signed the Inter-Governmental Agreement (IGA) in May 2017 for the East African Crude Oil Pipeline (EACOP) project. The agreement provided the foundation for other project agreements, like the host government agreements, shareholders' agreements and financing agreements, which have since not been signed. 

The joint venture partner CNOOC, Total and Tullow Oil have in the past indicated that the conclusion of the host government agreement could be key in the commercialisation of the Albertine region oil and gas.  

Construction of an over 1,149km-long pipeline from Kabaale, Hoima in Uganda to Chongoleani in Tanga, Tanzania should have started had the governments agreed on the remaining agreements.

The delay in construction of the pipeline together with other impediments, have pushed government to extend its first oil ambition earlier set for 2020 to 2021. 

Uganda is expected to pay Tanzania a minimum of $12.20 per barrel of oil, according to the past negotiations between the two governments. Initial estimates put the capacity of the pipeline at 216,000 barrels of crude oil per day. In a related development, sources indicate that the National Environment Management Authority's (NEMA) oil and gas team is expected to review the Environmental Social Impact Assessment (ESIA) report for the pipeline project.

NEMA is required to ensure that the project doesn't significantly affect the environment and people's livelihoods.

Comments

0 #1 kabayekka 2019-01-26 16:40
Of course this sort of business is going to affect the East African environment.

The issue is whether Uganda and its future generations will benefit plus whether it is viable for Tanzania to be paid money for Uganda to export crude oil over about 700 miles on land to Dar-es-Salaam port and then to China and other countries of Asia and Europe by ocean shipping.

The International price of Crude Oil presently is 55 dollars a barrel.
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0 #2 kabayekka 2019-01-26 16:51
Right now Uganda is floating in lots of international debts and the only hope of paying such debts is through the export of crude oil because this country is unable to refine crude oil into products of high value.

Even if this country has a very high unemployed but educated African population. It is high time the real experts came out to discuss this dilemma concerning M7's oil.

This is an economic programme of about 100 years that NEMA must discuss without any prejudice. All the facts must be put on the table.
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0 #3 kabayekka 2019-01-27 11:28
The inland country of Uganda trying its luck to export freshly excavated crude oil over a distance of 7000 miles all over this planet is like exporting freshly picked coffee beans from its tree gardens, packaged into clean boxes, and directed all the way to Vietnam industries!
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