The government of Uganda has granted a final approval for the construction of a $3.5bn pipeline that transports crude oil through Tanzania.
Uganda’s cabinet has approved the East African Crude Oil Pipeline Company (EACOP), an affiliate of French energy and petroleum company TotalEnergies to build the pipeline
TotalEnergies is the largest shareholder in EACOP with a 62% stake, while Uganda’s National Oil Company and Tanzania Petroleum Development Corp own 15% each
China’s China National Offshore Oil Corporation (CNOOC) owns 8% stake in EACOP.
In Uganda, commercial petroleum production has been delayed for nearly two decades, due to lack of infrastructure and disagreements between the government and oil companies.
EACOP will build the pipeline that will run 1,445kms, from the oilfields in the landlocked Uganda to a port on Tanzania’s Indian Ocean coast.
The project aims to extract the huge crude reserves under Lake Albert, a 160kms natural border between Uganda and the Democratic Republic of Congo.
It will transport the crude oil produced inside the country to the international markets, and will become the world’s longest heated pipeline.
The approval follows an agreement between Tanzania and Uganda, and a $10bn deal between TotalEnergies and CNOOC to develop oilfields and build the oil pipeline in Uganda.
The EACOP pipeline involves drilling in Uganda’s national park, Murchison Falls.
Environmental groups and activists said that the project harms the ecosystem in the region and the livelihoods of tens of thousands of people.
Uganda’s President Yoweri Museveni promised to proceed with the project regardless of the EU resolution, and would consider other partners if TotalEnergies stands by EU resolution.
Museveni said that the project will be a major economic boost for the landlocked country, where many live in poverty.
