Uganda, Tanzania, Oil Firms Sign Accords For Building $3.5B Pipeline

Uganda, Tanzania, Oil Firms Sign Accords For Building $3.5B Pipeline

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By Spy Uganda

Kampala: Uganda, Tanzania and oil firms Total and CNOOC on Sunday signed agreements that will kickstart the construction of a $3.5 billion crude pipeline to help ship crude from fields in western Uganda to international markets.

READ ALSO: Tanzanian President Suluhu Makes First State Visit To Uganda To Finalize Oil Deals

Tanzanian New President HE.Samia Suluhu Hassan With President Of Uganda HE. Yoweri Kaguta Museveni At State House-Entebbe, Kampala On 11/April, 2021

France’s Total and China’s CNOOC own Uganda’s oil fields after Britain’s Tullow exited the country last year.

READ ALSO: Total Warms Up For $5.1bn Uganda Oil Project Ahead Of Sunday’s Presidential Meeting

The signatories have now agreed “to start investing in the construction of infrastructure that will produce and transport the crude oil”, said Robert Kasande, permanent secretary at Uganda’s ministry of energy.

Ugandan President Yoweri Museveni and Tanzania’s new leader Samia Suluhu Hassan attended the signing ceremony.

READ ALSO: Finance Them At Your Own Risk: East African Banks Ordered Not To Finance Uganda-Tanzania Oil Pipeline

Uganda discovered crude reserves in the Albertine rift basin in the west of the country near the border with the Democratic Republic of Congo in 2006. Government geologists estimated overall reserves at 6 billion barrels.

However, the landlocked East African nation needs a pipeline to transport the crude to international markets.

The planned East African Crude Oil Pipeline (EACOP), with a length of 1,445 kilometers (898 miles), will run from the oilfields to Tanzania’s Indian Ocean seaport of Tanga.

READ ALSO: Double Loss! Magufuli’s Death Halts Launch Of EA Oil Pipeline Project

Uganda’s crude is highly viscous, which means it needs to be heated to be kept liquid enough to flow.

Total said EACOP could potentially be the longest electrically heated crude oil pipeline in the world.

The pipeline has met resistance from environmentalists who argue it will threaten ecologically sensitive areas along its route, including wildlife reserves and water catchment areas for Lake Victoria.

About 263 non-governmental organizations (NGOs) from around the world have urged the chief executives of 25 banks not to extend loans to fund the pipeline.

READ ALSO: Multibillion Total, E.A Crude Oil Pipeline Deal Kicks Off With Invitation For Bidders

The project, they say, would pose immense threats to local communities, water supplies, and biodiversity in Uganda, Tanzania, the Democratic Republic of Congo and Kenya.

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