Kenya to build oil pipeline alone as Uganda prefers Tanzania’s Tanga port

Kenya to build oil pipeline alone as Uganda prefers Tanzania’s Tanga port

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Uganda will take its oil to the market through Tanzania’s Tanga port, leaving Kenya to build its own pipeline to Lamu, if the positions taken at the just-ended talks in Kampala are maintained.

“We have lost the pipeline deal to Tanzania. The only deal is to go back to the drawing board to construct our own pipeline to Lamu port,” a senior Kenyan official said on Friday

The outcome of the talks was closely guarded, with the technocrats meeting in Kampala insisting that the final position would be announced during the Northern Corridor Heads of State Summit next week.

Uganda may have already sealed a deal with Tanzania to take the Tanga route and to let oil firm Total E&P of France fund and operate the pipeline.

Last week in Kampala, Uganda held two separate meetings with Kenya and Tanzania; each consultation came up with a report. It had been agreed that the technical teams would compile the two reports and hand over a joint report to the heads of State.

However, the Ugandan team is said to have been reluctant to share the report of its consultations with Tanzania.

“Uganda is playing hardball and has refused to share the report from its discussions with Tanzania. This then leaves us nowhere,” said one of the Kenyans close to the discussions.

However, it has also emerged that the Kenyan officials participating in the Kampala talks may not have had all their facts right as they tried to address the concerns raised by Uganda over the northern route for the pipeline.

For example, Uganda had raised concerns over the location of the pipeline terminal at Lamu port — a spot that they feared was prone to Monsoon winds — as well as the financing for the pipeline.

“On financing, Kenya was not clear on how to finance the pipeline even though it indicated that many organisations were willing to provide funds. Uganda felt this could take long and result in delays in the export of the oil,” he said.

Meanwhile, Total reaffirmed its commitment to construct the $4 billion crude oil pipeline to Tanga.

Total is eyeing production of an estimated 6.5 billion barrels of Uganda’s crude oil by 2018.

Kenya’s apparent resignation and decision to go it alone is in line with President Uhuru Kenyatta’s recent remarks that the Lamu Port – Southern Sudan – Ethiopia Transport (Lapsset) Corridor must and would proceed, even without Uganda.

“The Lapsset project will move forward whether or not Uganda opts to have its oil pass through Kenya’s Northern Corridor,” said President Kenyatta.

 Photo: Courtesy, Story: BD Africa
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