Uganda–Tanzania Crude Oil Pipeline

The oil pipeline will start in Buseruka sub-county, Hoima District, in Uganda's Western Region. It will travel in a general south-easterly direction to pass through Masaka in Uganda, Bukoba in Tanzania, loop around the southern shores of Lake Victoria, continue through Shinyanga and Singida, to end in Tanga,[8] a distance of approximately 1,410 kilometres (880 mi).[9]

Uganda has proven oil reserves exceeding 6.5 billion barrels, of which about 2.2 billion barrels are recoverable.[10] The country plans to build a refinery in the Western Region to meet local and regional demand, with the rest exported via pipeline to the Indian Ocean coast.[11]

Uganda previously agreed to build a joint Uganda–Kenya Crude Oil Pipeline to the Kenyan port of Lamu.[12][13]

Concerns regarding security and cost, however, motivated parallel negotiations with Tanzania regarding a shorter and safer route to Port Tanga, with the support of the French petroleum conglomerate Total SA.[14][15]

At the 13th Northern Corridor Heads of State Summit in Kampala in April 2016, Uganda officially chose the Tanzania route for its crude oil, in preference to the Mombasa or Lamu routes in Kenya. The presidents of both Kenya and Rwanda were present, along with representatives from Ethiopia, South Sudan, and Tanzania.[16][17] At the same summit, President Uhuru Kenyatta announced that Kenya would build the Kenya Crude Oil Pipeline on its own, thereby abandoning the Uganda–Kenya Crude Oil Pipeline.[18][19]

The construction budget for the 1,445 kilometres (898 mi) pipeline is US$3.5 billion.[20][21] The pipeline is planned to have a capacity of 216,000 barrels of crude oil per day.[20] It will be 24 inches (61 cm) in diameter, and Uganda will pay Tanzania US$12.20 for every barrel flowing through the pipeline.[22]

Construction originally was planned to start in August 2016 and last three years at a budgeted cost of US$4 billion, providing approximately 15,000 construction jobs and 1,000 to 2,000 permanent jobs.[23] In March 2016, the Daily Monitor newspaper reported that Total E&P was prepared to spend US$4 billion (UGX:13 trillion) to fund construction of this pipeline.[9] Following meetings between delegations led by the oil ministers of Tanzania and Uganda, held in Hoima in July 2016, it was announced that construction of the 1,443 kilometres (897 mi) pipeline would begin in January 2017.[24] Completion was planned for 2020.[25]

On 11 September 2020, Total SA and the government of Uganda signed the Host Government Agreement (HGA) for the East Africa Crude Oil Pipeline (EACOP) project, at State House Entebbe. This is expected to lead to Final Investment Decision (FID), by the end of 2020.[26][27]

Two days later, President Yoweri Museveni of Uganda and President John Pombe Magufuli of Tanzania signed an agreement in Chato, committing to jointly construct the 1,445 kilometres (898 mi) Est Africa Crude Oil Pipeline, at an estimated cost of US$3.5 billion. Work on the pipeline is scheduled to start by the end of 2020.[28] Once started, construction of the pipeline is expected to last about 36 months.[27]

On 27 October 2020, Total SA and the Government of Tanzania signed an HGA that will govern the dealings of the two entities regarding the EACOP, 70 percent of which will pass through Tanzanian territory. Laying of the pipeline is anticipated to begin during the first quarter of 2021.[29]

As of August 2017, the list of potential equity partners included several stakeholders as outlined in the table below:[30]

Negotiations and the search for international lenders are ongoing. Uganda and Tanzania are being advised by Standard Bank of South Africa, while Total SA is being advised by Sumitomo Mitsui Banking Corporation. The London-based firm law firm Clifford Chance is advising Total SA on legal matters, while CNOOC is advised by the Imperial Bank of China.[30]

In April 2020, Tullow Oil Plc sold its "entire interests in Uganda's Lake Albert development project, including the East African Crude Oil Pipeline", to Total S.A., for a consideration of US$575 million. Total will assume all tax liabilities related to the transaction.[31] As of April 2020, the ownership of the pipeline was as represented in the table below.[32]

An oil refinery is planned to be constructed in western Uganda to process the oil for use within the East African Community. The US$2.5 billion project is to be developed under a public-private partnership, with 50 percent of the project owned by a private developer and 10 percent owned by Jk Minerals Africa of South Africa. The remaining 40 percent will be distributed among the East African countries.[33] On 30 April 2016, Tanzania agreed to buy 8 percent of the shares in the refinery for US$150.4 million.[34]

Project will allegedly "displace thousands of small farmers and put key wildlife habitat and coastal waters at risk."[35] Civil society organizations have petitioned funding agencies to not support the project, citing potential social and environmental harm that the pipeline will cause.[36][37]

• Petroleum Authority of Uganda
• Kenya–Uganda–Rwanda Petroleum Products Pipeline
• Hoima–Kampala Petroleum Products Pipeline

• Official Website
• Pipeline dreams: Inside the Uganda–Tanzania oil pipeline talks As of 18 March 2019.
• East Africa: DR Congo Shows Interest As Uganda-Tanga Port Oil Pipeline Preps in Top Gear
• Uganda, Tanzania discuss oil pipeline