Oil reserves were discovered in Uganda in 2006 by Tullow Oil Company, near Lake Albert in western Uganda, but production was delayed due to lack of infrastructure, including an export pipeline.
Total which is a French Oil Company was to develop the fields along Tullow Oil Company and china’s Cnooc Limited. Tullow later on sold stakes to Total and Cnooc and ceased being one of the operators.
After the discovery, production licences were issued and a deal was struck for the route of the pipeline. Uganda agreed to build a joint Uganda-Kenya Crude Oil Pipeline (UKCOP) from Hoima area in western Uganda through Lokichar in north western Kenya on to the Lamu Port for export.
Concerns regarding security and cost, however, reportedly motivated parallel negotiations with Tanzania regarding a shorter and safer route to Port Tanga, with the support of the French petroleum conglomerate Total SA
During the 13th Northern Corridor Heads of State Summit in Kampala in April 2016, Uganda officially announced its choice for the Tanzania route for its crude oil, in preference to the Mombasa or Lamu routes in Kenya 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 (UKCOP)
In September 2019, Total suspended all work on the pipeline construction following the collapse of a deal to buy a stake in Tullow Oil Plc’s oil fields in Uganda. This was later resolved in April 2020 with Total buying Tullow’s shares in the Lake Albert project licenses for $575 million.
On 13 September, 2020, Uganda’s President Yoweri Museveni and his Tanzanian counterpart John Magufuli, signed a deal that will see the two countries build a 1,445km, $3.5bn crude oil pipeline Project from Hoima in western Uganda to the port of Tanga, this comes Two days after Kampala signed a host government agreement with French oil giant Total. The agreement was meant to govern the export pipeline project in the country.
In an article published on the Standard Newspaper, Kenya has an estimated 560 million barrels of recoverable oil against Uganda’s 1.6 billion barrels; Kenya had eyed the infrastructure with a plan of becoming the preferred regional petroleum transporter of choice.
Impact of East Africa Crude Oil Pipeline (EACOP) in Tanzania
About 80% of the pipeline will run through Tanzania. The country is expected to earn $3.24 billion (Sh349 billion) from the pipeline and create at least 18,000 jobs, Reuters news agency quotes government spokesman Hassan Abassi, Tanzania’s government spokesman saying.
In a joint report by the International Federation for Human Rights (FIDH) and Oxfam, more than 12,000 families risk losing their land and livelihoods.
Kenya’s reaction to the loss of the lucrative infrastructure project
“It has nothing to do with us. They were always going to build a pipeline” The standard newspaper quotes the Petroleum Principal Secretary Andrew Kamau downplaying the impact of the agreement between Tanzania and Uganda.
A social activist and co-ordinator of the Kenya Civil Society Platform on Oil and gas was also quoted by the Standard newspaper saying that they have not given up on the project, they will only give up when the project is financed and its construction started.