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Saturday 10 May 2014

[RwandaLibre] Oil pipeline deal to be sealed next month

 

Oil pipeline deal to be sealed next month
By Peterson Thiong'o
Posted Saturday, May 10 2014 at 17:05

Kenya, Rwanda and Uganda will next month sign a deal that is expected
to guide the construction of the Hoima-Lokichar-Lamu crude oil
pipeline, a key project that could dictate the shape the region's
energy infrastructure will take.

The three countries said they will sign a Memorandum of Understanding
that will bind the two implementing countries --Kenya and Uganda -- to
ensuring the project is completed in 2017-2018 when both states are to
officially start exporting crude oil.

READ: East Africa leaders agree on key infrastructure projects

The pipeline is expected to run 1,500km from Hoima near Lake Albert in
western Uganda to Lamu port on Kenya's Coast. South Sudan is to be
connected at Lokichar.

Each country will build the portion within its territory. Details from
last week's Northern Corridor Integration Projects meeting in Nairobi
show the three countries agreed to appoint a single transactional
advisor for the project but at the same time give each country the
option of choosing its own financing arrangement.

"The pipeline should be developed as a single project but split into
lots and implemented within the agreed specifications and timelines...
the respective countries to ensure that any change of their priorities
doesn't interfere with the construction and operation of the entire
pipeline from Hoima to Lamu," said a ministerial report of the summit
seen by The EastAfrican.

South Sudan, the report says, is expected to continue talks with Kenya
on a possible inter-governmental agreement on the project that will
see Juba formally join the project.

The Nairobi meeting was attended by presidents Uhuru Kenyatta (Kenya),
Paul Kagame (Rwanda) and Yoweri Museveni (Uganda) and Salva Kiir
(South Sudan), while Tanzania was represented by Prime Minister
Mizengo Pinda, and Burundi by second Vice President Gervais
Rufyikiri.

The proposed crude oil pipeline is crucial for Kenya, Rwanda and
Uganda who are implementing various joint projects including railway
lines, pipelines, power lines and a refinery.

For Uganda, a joint pipeline with Kenya, Rwanda and South Sudan means
that it cuts the cost and fast-tracks the construction process.

For Kenya, the pipeline increases the viability of the Lamu Port South
Sudan Ethiopia Transport (Lapsset) corridor, especially because a
crude pipeline was not part of the initial design.

A shared petroleum infrastructure is vital for Kenya and Uganda as
Tullow Oil Plc has confirmed the presence of commercial oil near the
shores of Lake Albert in Uganda and also discovered crude oil in
Turkana County in northwestern Kenya.

For South Sudan an alternative pipeline to evacuate its oil is a
strategic investment especially in the wake of constant hostilities
between Juba and Khartoum.

The construction of the new pipelines are seen as crucial in lowering
costs and ensuring energy security of hinterland land countries -- like
Uganda, Rwanda and Burundi.

http://www.google.ca/gwt/x?gl=CA&source=s&u=http://www.africapressreview.com/link-a%3Fid_syndic_article%3D203760&hl=en-CA&ei=MIBuU6TDNoeosgetrYCYDQ&wsc=yh

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