Uganda’s oil pipeline venture fit for export

The design of a planned $3.5bn pipeline to pump Ugandan oil through Tanzania for export will be completed in 2017 and will avoid the ecologically sensitive Serengeti National Park, according to a top Ugandan government official.

The project is crucial to kick-start Uganda’s oil industry and would be a major infrastructure undertaking in Tanzania, one of the world’s poorest and least-developed countries. The Serengeti is famed for its wildebeest migration.

The final costs of the pipeline could be revised after the design is completed and environmental impact assessments have started, Ernest Rubondo, executive director of the Petroleum Authority of Uganda, told Reuters on Thursday.

“The front-end engineering and design [FEED] is being completed soon, and it is the designs that actually give you the cost,” Rubondo said.

“The estimate is $3.5bn but the FEED will give a more concrete figure,” he said, adding that if the cost estimate was revised, it could also happen before the end of the year and it was unlikely to go higher.

French oil major Total has the lead in the project in partnership with China’s CNOOC, Britain’s Tullow Oil and the governments of Uganda and Tanzania, Rubondo said.

This grouping would form a company next year to see the pipeline through and it would decide “what mix of debt and equity will be used to fund it”. Asked about ecological concerns, he said: “There are no environmental concerns that can’t be mitigated.”

He said: “What most people worry about is that it is going through the Serengeti, but it is far from the Serengeti National Park.”

Source: Reuters

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