Uganda: Museveni, Magufuli sign pact to commission crude oil pipeline

Presidents Yoweri Museveni and Pombe Magufuli signed a deal to commission a 1,445-km East African Crude Oil Pipeline (EACOP) running from Hoima in Uganda to the port city of Tanga in Tanzania.

Hosting President Museveni in Chato District, northwestern Tanzania, President Magufuli said the project will see Tanzania making more than USD 3.24 billion and the creation of over 18,000 jobs.

“Under this project Tanzania will have 1145km which will see the creation of more than 18,000 jobs while Uganda will utilize the rest,” said Magufuli.

The pipeline is estimated to cost USD3.5 billion with both countries expecting its completion within three years from the date of commissioning. Uganda discovered oil reserves in 2006 and only requires EACOP to be in place to start its commercial production.

The pact between the two nations comes after Uganda and Total signed a host government agreement to protect its rights and obligations in the construction and operation of the pipeline.

“I am glad that Total and other companies licensed in the country are taking bold steps to quickly commence the production of petroleum,” President Museveni said.

With Total being the major shareholder in Uganda’s oilfields, the two countries agreed on a 40:60 profit sharing formula, a consensus reached on the basis of 70 per cent of the pipeline running through Tanzania’s territory.

“Under this project Tanzania will have 1145km which will see the creation of more than 18,000 jobs while Uganda will utilize the rest,” said Magufuli.

Liberty Pazvakawambwa

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