EACOP vs Lamu pipeline

EACOP vs Lamu pipeline


View: https://twitter.com/BusInsiderSSA/status/1714653360215785710


$4 Billion Uganda-Tanzania crude oil pipeline nears final investment decision​


ADEKUNLE AGBETILOYE
October 18, 2023 1:50 PM

pipeline

pipeline

  • A $4 billion Uganda-Tanzania crude oil pipeline has cleared a major obstacle that had delayed a final investment decision, according to Standard Bank Group Ltd.
  • Standard Bank's decision to invest up to $100 million hinges on an agreement between project developer TotalEnergies SE, China's CNOOC Ltd.
  • The 1,443-kilometer (897-mile) pipeline should start transporting oil in 2025 and ferry 246,000 barrels daily at peak.
The contentious $4 billion Uganda-Tanzania crude oil pipeline has cleared a major obstacle that had delayed a final investment decision, according to Standard Bank Group Ltd.


Now, discussions can move forward after Tanzania resolved a dispute with certain Chinese financiers on an unrelated issue, according to Kenny Fihla, the CEO of the bank's commercial and investment banking division.

“That’s where the delay was because of the historical dispute between the Tanzanian government and some of the Chinese funders, which had nothing to do with the project, but it needed to be resolved to enable an agreement on the pipeline,” Fihla said in an interview. “We’re told that the agreement has been reached.”

Standard Bank's decision to invest up to $100 million hinges on an agreement between project developer TotalEnergies SE, China's CNOOC Ltd., and the governments of Uganda and Tanzania regarding the financing structure, as explained by Fihla.


The bank is also awaiting completion of an environmental and social impact assessment study, Chief Executive Officer Sim Tshabalala said last week, Bloomberg reported.

“The data-gathering process and response is close to finality,” Fihla said. “If we’re comfortable with that, we’ll say yes, but if we’re uncomfortable with that, we’ll either require further studies or we’ll say no.”

The construction of the major fossil fuel project has sparked a debate around economic development and environmental protection in one of the regions most vulnerable to climate change.

Environmental groups have raised concerns about potential damage to the habitats of endangered wildlife species and displacement of at least 118,000 people. As many as 260 civil society organizations have asked lenders, including Standard Bank, not to take part in the project.

Fihla is confident that this project will indeed have a positive economic impact on Uganda's economy. However, he also acknowledges that the project will proceed with or without the participation of Standard Bank.

“It is not dependent on Standard Bank’s funding at all. We will fund it - if we ultimately decide to - because it’s the right thing to do for the economy of Uganda and Tanzania, and because we think all the issues have been adequately dealt with and addressed,” he said.

The 1,443-kilometer (897-mile) pipeline should start transporting oil in 2025 and ferry 246,000 barrels daily at peak, according to a project website. TotalEnergies has a 62% stake in the planned conduit that once complete will be the world’s longest heated pipeline.

State-owned Tanzania Petroleum Development Corp. and Uganda National Oil Co. each have a 15% interest, while the rest is owned by CNOOC. The project will be funded on a 40:60 equity-debt ratio, according to UNOC.

africa.businessinsider.com

$4 Billion Uganda-Tanzania crude oil pipeline nears final investment decision

The contentious $4 billion Uganda-Tanzania crude oil pipeline has cleared a major obstacle that had delayed a final investment decision, according to Standard Bank Group Ltd
africa.businessinsider.com africa.businessinsider.com
 
www.independent.co.ug

Stop EACOP shifts campaign to Chinese banks

Kampala, Uganda | THE INDEPENDENT | The stop EACOP campaigners are now targeting Chinese banks and insurance firms from funding the longest crude oil pipeline between Uganda and Tanzania. The latest move by the international and their local campaigners comes after they successfully fought off...
www.independent.co.ug www.independent.co.ug
 
NEWS

Uganda-Tanzania Pipeline Nears Investment Decision: Standard Bank​

by Bloomberg
|
Adelaide Changole
|
Wednesday, October 18, 2023



Share
submit to reddit
email print
Uganda-Tanzania Pipeline Nears Investment Decision: Standard Bank

Negotiations can now conclude after Tanzania settled a disagreement with some Chinese funders.
Image by kodda via iStock

A controversial $4 billion crude oil pipeline to link Uganda and Tanzania has overcome a key hurdle that delayed a final decision, according to Standard Bank Group Ltd.
Negotiations can now conclude after Tanzania settled a disagreement with some Chinese funders on a separate matter, according to Kenny Fihla, the chief executive officer for the lender’s commercial and investment banking unit.
“That’s where the delay was because of the historical dispute between the Tanzanian government and some of the Chinese funders, which had nothing to do with the project, but it needed to be resolved to enable an agreement on the pipeline,” Fihla said in an interview. “We’re told that the agreement has been reached.”
Standard Bank can only decide whether to invest as much as $100 million after project developer TotalEnergies SE, China’s CNOOC Ltd., Uganda and Tanzania have to agree on the financing structure, Fihla said. The bank is also awaiting completion of an environmental and social impact assessment study, Chief Executive Officer Sim Tshabalala said last week.
“The data-gathering process and response is close to finality,” Fihla said. “If we’re comfortable with that, we’ll say yes, but if we’re uncomfortable with that, we’ll either require further studies or we’ll say no.”
Heavy Criticism
The 1,443-kilometer (897-mile) pipeline should start transporting oil in 2025 and ferry 246,000 barrels daily at peak, according to a project website. TotalEnergies has a 62 percent stake in the planned conduit that once complete will be the world’s longest heated pipeline. State-owned Tanzania Petroleum Development Corp. and Uganda National Oil Co. each have a 15 percent interest, while the rest is owned by CNOOC. The project will be funded on a 40:60 equity-debt ratio, according to UNOC.
The bank has come under heavy criticism by environmental groups citing potential damage to the habitats of endangered wildlife species and displacement of at least 118,000 people. As many as 260 civil society organizations have asked lenders, including Standard Bank, not to participate.
The economic impact of the project on Uganda’s economy is, however, not in doubt, according to Fihla.
“This project and the development will go ahead with or without the participation of Standard Bank,” he said. “It is not dependent on Standard Bank’s funding at all. We will fund it - if we ultimately decide to - because it’s the right thing to do for the economy of Uganda and Tanzania, and because we think all the issues have been adequately dealt with and addressed.”
 
You must log in or register to reply here.

Similar Discussions

Our Community

Coming Soon

Regional Communities

Coming Soon
Back
Top Bottom
Menu
Forums
New posts
Log in
Register