Oil pipeline works to start from Tanzania

The construction of the proposed East African Crude Oil Pipeline (EACOP) will start on the Tanzanian side en route to Uganda, officials have revealed but without stating the start date.

Speaking yesterday at a press briefing on the oil agreements signed on Sunday, the Eacop company general manager, Mr Martin Tiffen announced that construction works on all the oil projects - Total E&P’s Tilenga in Nwoya and Buliisa districts, Cnooc’s Kingfisher in Hoima and Kikuube districts, and the pipeline - will move simultaneously.

“We are not retracting on the momentum,” Mr Tiffen said.

He explained that the pipeline would start in Tanzania because  the distance is longer moving into Uganda.
Although Mr Tiffen was unwilling to provide additional details,  sources told Daily Monitor that in Tanzania land acquisition is  much easier because government owns the land. In Uganda the airport is not yet ready meaning construction materials have to be  brought by road.

The Tanzanian pipeline section from the border town of Mutukula to Chongoleani terminal in Tanga at the Indian Ocean is 1,443km.  The Ugandan section from Hoima through 10 districts of Hoima, Kikuube, Kakumiro, Kyankwanzi, Mubende, Gomba, Ssembabule, Lwengo, Kyotera to Mutukula in Rakai is 296km.
 Mr Tiffen further explained that there are only few pending items in the way of starting construction works, including government giving not to the Engineering, Procurement, and Construction (EPC) contracts, and signing of the Host Government Agreement (HGA) with the Tanzanian government “expected in the coming weeks.”  

Oil and gas companies often rely on EPC contractors for large-scale and long-term projects that require skilled labour and fine-tuned project management.  
The Tanzanian HGA was due for signing on Sunday but was delayed due to last minute changes in Tanzania’s shareholding in the EACOP. The new shareholding structure, as detailed in the Shareholders Agreement, which defines the rights and responsibilities of the shareholders in the pipeline company as signed on Sunday, is; Uganda through Unoc with 15 per cent, Total Holdings International B.V. with 62 per cent, Tanzania through its national oil company, TPDC, with 15 per cent, and Cnooc with 8 per cent.

“The Shareholders Agreement is significant because it has constituted the EACOP Company, and will now guide the funding of shareholding, finance structure and general governance of the company,” said Energy minister Goretti Kitutu.

Source: Citizen.