Africa’s first major oil pipeline to be build by Uganda and Tanzania
September, 15th 2020
Uganda and Tanzania have signed a deal to build East Africa’s first major oil pipeline. It comes just two days after Kampala signed a host government agreement with French oil giant Total.
Uganda’s President Yoweri Museveni and his Tanzanian counterpart John Magufuli, signed a deal on 13 September that will see the two countries build a 1,445km, $3.5bn crude oil pipeline.
The pipeline, which will be the first of its kind in East Africa, will connect Uganda’s oil-rich Hoima region with the Indian ocean through the Tanga port in Tanzania.
The deal follows Museveni’s deal with Total, which lays the groundwork for a final investment decision in the coming months, said the French oil giant in a statement published on 11 September.
In April, Total bought Tullow’s entire 33.3% stake in licenses in Uganda, as well as its stake in the pipeline for $575m. In addition to the Ugandan and Tanzanian governments, it will now develop the pipeline with CNOOC Ltd., a subsidiary of China’s national oil company.
About 80% of the pipeline will go through Tanzania. That means the project is expected to create thousands of jobs in Tanzania, and likely a good reason to sign a similar deal with Total. President Magufuli added that the country would utilise Uganda’s experience to explore for oil in several of its regions. “When we strike oil, we will simply connect those areas to the East Africa Crude Oil Pipeline,” Magufuli said during the signing ceremony with his Ugandan counterpart on Sunday.
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