Uganda, Tanzania Sign Oil Pipeline Agreement
Key agreements signed between Uganda and Tanzania, together with oil firms Total and China National Offshore Oil Corporation (CNOOC) are set to transform Uganda into a significant crude producer and exporter.
The East African Crude Oil Pipeline ( EACOP) project agreement – which was signed by Uganda’s President Yoweri Museveni and Tanzania’s President Samia Hassan Suluhu – paves the way for the construction of a 1,440 km crude oil pipeline from Uganda’s Albertine region to Tanzanian seaport of Tanga.
“The EACOP Tripartite Project Agreement has been signed by all parties […] for the benefit of all people of Uganda and Tanzania, in the spirit of East Africa,” stated Uganda’s foreign minister, Sam Kutessa. The agreements mandate that oil companies must award at least 30% of project-related contracts to local Ugandan supplier, that the oil will be partly refined in Uganda to supply the local market and that Uganda will pay Tanzania $12.20 for every barrel flowing through the pipeline. The signatories also agreed to invest in infrastructure that will produce and transport crude oil from the landlocked country of Uganda to international markets.
The heated pipeline, with a length of 1,445 km, will be constructed from Uganda’s Albertine Graben Region to Tanzania’s Indian Ocean seaport of Tanga, where it will be transported to international markets. The crude found in Uganda is highly viscous, which requires heat in order to flow. Total – which holds a large stake in the pipeline project – has noted that the EACOP could potentially be the longest electricity heated crude oil pipeline in the world.
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