Pipeline deal papers signed

[lenpel]

PIPELINE DEAL PAPERS SIGNED

In Summary
•The two-country 24-inch pipeline will deliver about 200,000 barrels of crude oil per day
•The Tanzanian and Ugandan presidents first revealed the j oject dur

Arusha. Tanzania and Uganda on Thursday signed crucial agreements which will pave the way for the implementation of a 1,403 kilometre oil pipeline project.

Laying of the pipeline from the oilfields in Lake Albert North West of Uganda to Tanga port and associated civil works will cost an estimated $ 12 billion, according to officials of both countries.

The 24-inch pipeline will deliver about 200,000 barrels of crude oil per day. Implementation of the project is slated to commence any time next year and is scheduled for completion in 2020.

Speaking after signing the documents in Arusha, the minister for Energy and Minerals, Prof. Sospeter Muhongo, said officials of the two countries had agreed that the project should start as soon as possible.

This follows consultations between experts from Tanzania and Uganda who analysed the proposed pipeline deeply.

The minister told reporters that experts had also discussed the best way the project would be implemented as well as how the people who would be relocated to pave way for the pipeline would be compensated.

However, Prof. Muhongo could not go into details on the actual route of the proposed pipeline within Tanzania, only mentioning Kagera and Singida regions as well as the port city which is within Tanga region.

Other regions which are likely to be within the route to the sea port may include Geita, Shinyanga, Simiyu and Manyara.

President Magufuli and his Ugandan counterpart, Mr Yoweri Kaguta Museveni, for the first time revealed about the joint project during a media briefing session in Arusha on March 1, ahead of the East African Community (EAC) leaders’ summit.

Uganda would soon start drilling oil from Lake Albert after discovery of huge reserves of the hydrocarbons more than a decade ago.

It is believed the land-locked country wants to use the pipeline to export its oil through the Tanga port as well as supply the huge Tanzania market where no oil has been found despite the country having vast reserves of natural gas.

Apparently,the proposed pipeline has caught neighbouring Kenya by surprise because Uganda passes the bulk of its exports through the Mombasa port.

Kenyan newspapers reported recently that their government was set to revive talks with Ugandan authorities on the once mulled oil pipeline from the latter’s oilfields to various cities in Kenya.

Source: The Citizen.

 

[Tutafika]

Envious Kenyans will never come here to congratulate their neighbours

 

[lenpel]

Envious Kenyans will never come here to congratulate their neighbours

so likely...just want to hear the likes of MK254 when they read this. They once dubbled this as a white elephant project...i believe God will walk us through before this year to witness the launch of Bagamoyo Port project and Central Railway line to Kigali...God bless Africa, God bless Tanzania...!!!

 

[MK254]

so likely...just want to hear the likes of MK254 when they read this. They once dubbled this as a white elephant project...i believe God will walk us through before this year to witness the launch of Bagamoyo Port project and Central Railway line to Kigali...God bless Africa, God bless Tanzania...!!!

Hii issue sielewi kwanini huwa mnakua na ulimbukeni kwa masuala ya kibiashara hivi. Mnafaa muelewe kama Wakenya tuna haki ya kuhisi vibaya kwa kupoteza hiyo fursa, ni jambo la kawaida kwa mwanabiashara kuhisi hivyo na hamna la ajabu hapo.

Tulitaka tufanye huo mradi, lakini mambo kadhaa hayakuendana vizuri, mwekezaji Total PLC alipigania kutumia Tanzania kwa sababu kadhaa, ikiwemo kwamba ni njia fupi, pili usalama, tatu itampa fursa kupata nafasi zaidi za biashara huko Tanzania, na ndio maana yupo radhi kugharamia mradi wote bila kumdai yeyote. Sasa kwa mazingira kama hayo, lazima angetushinda sisi Wakenya.

Cha msingi ni kuelewa haya ni mahesabu ya kibiashara, ukipoteza unaomboleza kwa siku moja na baadaye kufanya mengine bila majungu. Lakini ingekua nyie ndio imewakosa, aisei hakungekalika huko Bongo, mngetiririka kwa matusi na majungu. Mjifunze biashara, haina undugu wala udada, ni maslahi na mahesabu.

 

[lenpel]

Hii issue sielewi kwanini huwa mnakua na ulimbukeni kwa masuala ya kibiashara hivi. Mnafaa muelewe kama Wakenya tuna haki ya kuhisi vibaya kwa kupoteza hiyo fursa, ni jambo la kawaida kwa mwanabiashara kuhisi hivyo na hamna la ajabu hapo.

Tulitaka tufanye huo mradi, lakini mambo kadhaa hayakuendana vizuri, mwekezaji Total PLC alipigania kutumia Tanzania kwa sababu kadhaa, ikiwemo kwamba ni njia fupi, pili usalama, tatu itampa fursa kupata nafasi zaidi za biashara huko Tanzania, na ndio maana yupo radhi kugharamia mradi wote bila kumdai yeyote. Sasa kwa mazingira kama hayo, lazima angetushinda sisi Wakenya.

Cha msingi ni kuelewa haya ni mahesabu ya kibiashara, ukipoteza unaomboleza kwa siku moja na baadaye kufanya mengine bila majungu. Lakini ingekua nyie ndio imewakosa, aisei hakungekalika huko Bongo, mngetiririka kwa matusi na majungu. Mjifunze biashara, haina undugu wala udada, ni maslahi na mahesabu.

at least kwa leo umekuwa Neutral...

 

[MK254]

at least kwa leo umekuwa Neutral...

Sio issue na kuwa neutral, mimi bado nipo mzalendo kabisa kwenye nchi yangu na taifa letu tukufu la Kenya. Japo hapa naangalia issue kwa mtazamo wa kibiashara na ubepari bila kushirikisha undugu. Kwenye masuala ya ubepari, unakua tayari kupoteza fursa kama hukukidhi vigezo vinavyohitajika, na bila kuwa na majungu wala nini. Haya ni mahesabu ya biashara, mteja ni Mganda ambaye amebebwa na mwekezaji Total PLC ambaye anatumia hela zake kwenye kufukia bomba, hapo hapakua na namna, ilikua lazima tukubali kuwa wapole.

Mganda hana cha kupoteza, Mtanzania hana cha kupoteza, Mzungu amekuja na hela zake na yupo radhi kuzitumia kujenga muundo mbinu wote bila kumdai yeyote, mzungu huyo huyo ameingia gharama ya kutafuta maeneo yenye mafuta na kuyagundua Uganda, na hatimaye yeye atayachimba, wakati wote Mganda kama Mwafrika, alikaa pembeni hata bila kujua nini kinaendelea. Hapo sasa Mkenya angeshindana na Mzungu kwa lipi, wakati sisi tulitaka Mganda ahusike katika kugharamia bomba.

Kwenye mahesabu tumekubali. Sasa sisi itabidi tuendelee na safari yetu wenyewe ya kuchimba bomba la kusafirisha mafuta. Labda siku za usoni Mganda atahitaji kutumia mabomba yote mawili, hapo sisi kama mabepari na wana biashara, tutamsubiri na kumpokea.

 

[longi mapexa]

watanyooka tu!

 

[lenpel]

Sio issue na kuwa neutral, mimi bado nipo mzalendo kabisa kwenye nchi yangu na taifa letu tukufu la Kenya. Japo hapa naangalia issue kwa mtazamo wa kibiashara na ubepari bila kushirikisha undugu. Kwenye masuala ya ubepari, unakua tayari kupoteza fursa kama hukukidhi vigezo vinavyohitajika, na bila kuwa na majungu wala nini. Haya ni mahesabu ya biashara, mteja ni Mganda ambaye amebebwa na mwekezaji Total PLC ambaye anatumia hela zake kwenye kufukia bomba, hapo hapakua na namna, ilikua lazima tukubali kuwa wapole.

Mganda hana cha kupoteza, Mtanzania hana cha kupoteza, Mzungu amekuja na hela zake na yupo radhi kuzitumia kujenga muundo mbinu wote bila kumdai yeyote, mzungu huyo huyo ameingia gharama ya kutafuta maeneo yenye mafuta na kuyagundua Uganda, na hatimaye yeye atayachimba, wakati wote Mganda kama Mwafrika, alikaa pembeni hata bila kujua nini kinaendelea. Hapo sasa Mkenya angeshindana na Mzungu kwa lipi, wakati sisi tulitaka Mganda ahusike katika kugharamia bomba.

Kwenye mahesabu tumekubali. Sasa sisi itabidi tuendelee na safari yetu wenyewe ya kuchimba bomba la kusafirisha mafuta. Labda siku za usoni Mganda atahitaji kutumia mabomba yote mawili, hapo sisi kama mabepari na wana biashara, tutamsubiri na kumpokea.

Would you be kind enough and offer me, near approximations of the quantity of your Oil Discoveries in your country; in Billions Barrels worth of reserves!? Though i heard you have not done official appraisal.

 

[MK254]

Would you be kind enough and offer me, near approximations of the quantity of your Oil Discoveries in your country; in Billions Barrels worth of reserves!? Though i heard you have not done official appraisal.

Duh! Umeingia kwenye lugha ambayo itawapa chamgamoto ndugu zako kuelewa nini tunaongea kuhusu, na wataishia kutukana....

So far am aware of recoverable reserves estimated at 600 million barrels which will obviously go higher after appraisal which has not been done for long time now. Note also there are new discoveries that have been reported, the recent discovery saw Tullow Oil shares spike by more than 4.5pc.

Most important facts is that, we already have production sharing concession in place and we are most likely to begin production before next year, 2017.

Our calculations have shown we can extract at a break-even cost of about $25 (KSh2,543) per barrel, lower than the current global price of $30.

 

[GeniSys101]

Civil discussion and arguments today mk254..way to go brother

 

[lenpel]

Duh! Umeingia kwenye lugha ambayo itawapa chamgamoto ndugu zako kuelewa nini tunaongea kuhusu, na wataishia kutukana....

So far am aware of recoverable reserves estimated at 600 million barrels which will obviously go higher after appraisal which has not been done for long time now. Note also there are new discoveries that have been reported, the recent discovery saw Tullow Oil shares spike by more than 4.5pc.

Most important facts is that, we already have production sharing concession in place and we are most likely to begin production before next year, 2017.

Our calculations have shown we can extract at a break-even cost of about $25 (KSh2,543) per barrel, lower than the current global price of $30.

i have tried to quantify the data of your reserves you have stated above, and have come up with a conclusion that:-

given your current reserves are intact and constant till you start production and your employ construction of a pipeline with same dimensions as that of Hoima-Tanga 24' (inches) with the capacity of 200,000 barrels per day...you look to exhaust all your reserves of 600 Million Barrels of Oil in 8 years and 2 Months earning your nation a total of US $ 15 Billion from your breakeven price of US $ 25 which is slightly or a bit higher than the cost of constructing and maintaining the pipeline from Hoima-Tanga of US$ 13 Billion

My point is that, Kenyan Reserves are not yet economically viable, i think maybe delaying investment in extraction of oil is perhaps, due to this.

Think about it, building a pipeline through or from South Lokichar to Lamu (Your to be Oil Port and hub) involving construction of a modern port, refinery and logistical infrastructures only to extract 600 Million Barrels of Oil (Exclude South Sudan because, they have shown interest in linking their reserves through Hoima Tanga Pipeline its of less cost) this would be an unwise business move cause Kenya will incur a huge cost to construct the pipeline, protect it and other expenses bcz its mostly within your territory than it would be expanded to South Sudan or Uganda (because u said Kenya prefered the states to construct the pipelines rather than the firms) making your returns to be nearly unrealisable.

 

[MK254]

i have tried to quantify the data of your reserves you have stated above, and have come up with a conclusion that:-

given your current reserves are intact and constant till you start production and your employ construction of a pipeline with same dimensions as that of Hoima-Tanga 24' (inches) with the capacity of 200,000 barrels per day...you look to exhaust all your reserves of 600 Million Barrels of Oil in 8 years and 2 Months earning your nation a total of US $ 15 Billion from your breakeven price of US $ 25 which is slightly or a bit higher than the cost of constructing and maintaining the pipeline from Hoima-Tanga of US$ 13 Billion

My point is that, Kenyan Reserves are not yet economically viable, i think maybe delaying investment in extraction of oil is perhaps, due to this.

Think about it, building a pipeline through or from South Lokichar to Lamu (Your to be Oil Port and hub) involving construction of a modern port, refinery and logistical infrastructures only to extract 600 Million Barrels of Oil (Exclude South Sudan because, they have shown interest in linking their reserves through Hoima Tanga Pipeline its of less cost) this would be an unwise business move cause Kenya will incur a huge cost to construct the pipeline, protect it and other expenses bcz its mostly within your territory than it would be expanded to South Sudan or Uganda (because u said Kenya prefered the states to construct the pipelines rather than the firms) making your returns to be nearly unrealisable.

I am not so much of an expert in this field, it requires inputs from surveyors, civil engineers, structural engineers, petroleum engineers, economists and environmentalists. However, your estimations are based on worse case scenario, you should be conscious of the following

600-million-barrel discovery was in 2014, a lot has taken shape since then. A new appraisal might catapult us to more than a billion mark. And not forgetting the Organisation of Petroleum Exporting Countries, which consist of 13 nations, released a report pointing to a recovery in oil prices to $70 a barrel mid this year.

Even so, plans were already underway to build a corridor along the the northern part. So a pipeline will act as a catalyst for the other infrastructures such as port, railway, highway, resort cities etc. Note each of these infrastructures during their viability studies registered High Economic Internal Rates of Return (EIRR) of between 17% and 23.4% compared to acceptable industry minimum standard of 10%

We may also have it supplemented by project guarantees from multilateral agencies that appear supportive of the project. This ownership and management model allows the pipeline to be operated as a common user facility with open access to any oil investor with oil to pump through. With an existing infrastructure in place, who knows we might rope in South Sudan.

Eventually, if push comes to shove, we already have at our disposal an option to reroute and use the Lokichar - Eldoret - Mombasa path, the land is available and more secure, there is already a pipeline running refined oil. Meaning might be cheaper for us to construct a parallel crude oil pipeline along it.

 

[Geza Ulole]

I am not so much of an expert in this field, it requires inputs from surveyors, civil engineers, structural engineers, petroleum engineers, economists and environmentalists. However, your estimations are based on worse case scenario, you should be conscious of the following

600-million-barrel discovery was in 2014, a lot has taken shape since then. A new appraisal might catapult us to more than a billion mark. And not forgetting the Organisation of Petroleum Exporting Countries, which consist of 13 nations, released a report pointing to a recovery in oil prices to $70 a barrel mid this year.

Even so, plans were already underway to build a corridor along the the northern part. So a pipeline will act as a catalyst for the other infrastructures such as port, railway, highway, resort cities etc. Note each of these infrastructures during their viability studies registered High Economic Internal Rates of Return (EIRR) of between 17% and 23.4% compared to acceptable industry minimum standard of 10%

We may also have it supplemented by project guarantees from multilateral agencies that appear supportive of the project. This ownership and management model allows the pipeline to be operated as a common user facility with open access to any oil investor with oil to pump through. With an existing infrastructure in place, who knows we might rope in South Sudan.

Eventually, if push comes to shove, we already have at our disposal an option to reroute and use the Lokichar - Eldoret - Mombasa path, the land is available and more secure, there is already a pipeline running refined oil. Meaning might be cheaper for us to construct a parallel crude oil pipeline along it.

lenpel, this is not true! First Mombasa-Eldoret pipeline can not transport crude and has to be reversed! And if that was the case a very costly process from dilapilated facilities from KPLC. Studies were conducted on Hoima-Kampala-Eldoret-Nairobi-Mombasa and findings are not convincing since the expenses will go astronomical higher! Finding a space parrarel to the existing one means buying land along the route and those speculators (including Politicians) have already gone for a kill and acquired the land! I don't see a chance to change Uganda decision on Hoima-Tanga unless GOK, Tullow and CNOOC come up with other source of funds to undertake an alternative! As a matter of fact Total will ask for a buyout on Tullow's stake in Uganda oil reserves since the company lacks funds and keeps on draging the project back in an attempt to connect non viable reserves in Isiolo a route that is insecure! An issue of mistrust from partners about to venture in a large scale project.

Moreover there are issues of unfriendly terrain from Hoima-Lamu there are valleys+Lakes+rivers+Lakes incl. Kyoga that have to be crossed! Unlike the Tanga route that is sloping to the coast!

 

[lenpel]

lenpel, this is not true! First Mombasa-Eldoret pipeline can not transport crude and has to be reversed! And if that was the case a very costly process from dilapilated facilities from KPLC. Studies were conducted on Hoima-Kampala-Eldoret-Nairobi-Mombasa and findings are not convincing since the expenses will go astronomical higher! Finding a space parrarel to the existing one means buying land along the route and those speculators (including Politicians) have already gone for a kill and acquired the land! I don't see a chance to change Uganda decision on Hoima-Tanga unless GOK, Tullow and CNOOC come up with other source of funds to undertake an alternative! As a matter of fact Total will ask for a buyout on Tullow's stake in Uganda oil reserves since the company lacks funds and keeps on draging the project back in an attempt to connect non viable reserves in Isiolo a route that is insecure! An issue of mistrust from partners about to venture in a large scale project.

Moreover there are issues of unfriendly terrain from Hoima-Lamu there are valleys+Lakes+rivers+Lakes incl. Kyoga that have to be crossed! Unlike the Tanga route that is sloping to the coast!

i was not aware of such shortcomings in their refinery and huddles on the central terrain as the potetial of the pipeline Geza Ulole. Moreover was not also aware that, Tullow Oil Plc has been limited in terms of Cash to develop its Oil fields in Lokichar though i may contest for the case of CNOOC for it stands among the current Seven Sisters with PetroNas, PetroBras and Saudi Aramco to mention as to mention a few.

let me dive through my study and research to enlighten my understanding on it...!!!

 

[Geza Ulole]

i was not aware of such shortcomings in their refinery and huddles on the central terrain as the potetial of the pipeline Geza Ulole. Moreover was not also aware that, Tullow Oil Plc has been limited in terms of Cash to develop its Oil fields in Lokichar though i may contest for the case of CNOOC for it stands among the current Seven Sisters with PetroNas, PetroBras and Saudi Aramco to mention as to mention a few.

let me dive through my study and research to enlighten my understanding on it...!!!

the terrain is not on their favor Mt Elgon in the border btn Uganda and Kenya, Nile falls, Lake Kyoga u name it! However these are the things Kenyan media do not dare to talk about!

 

[lenpel]

the terrain is not on their favor Mt Elgon in the border btn Uganda and Kenya, Nile falls, Lake Kyoga u name it! However these are the things Kenyan media do not dare to talk about!

Any updates on the talks between Uhuru Kenyatta and Yoweri Museveni today in Nairobi on the NCIP which constituted of Hoima-Lokichar-Lamu pipeline. What have they concluded!? Will the pipeline pass through Tanzania or Kenya!? Geza Ulole MK254 sam999

 

[lenpel]

UHURU FAILS TO AGREE WITH MUSEVENI

By Victor Nyakachunga on Mon, 21 Mar 2016 - 6:43 pm


Deadlock,Nairobi: Uhuru with Museveni after the meeting at State House Google image

President Uhuru Kenyatta on Monday failed to reach a substantial agreement with Ugandan President Yoweri Museveni in regard to the construction of a pipeline route.
The meeting did not yield, prompting Kenyatta and his Ugandan counterpart opting to leave the contentious issues to be discussed by their technical officials, ahead of a meeting in Kampala when they will revisit the matter.
The two Heads of State had their team of technocrats present in the meeting held at State House Nairobi, where presentations were carried out, to draw on how the project would be done.
“The two leaders heard technical presentations by Kenyan and Ugandan energy officials on options to construct the pipeline from Hoima on Lake Albert through Kenyan 'nothern route' through the oil fields of Lokichar; the Kenyan 'southern route' through the town of Nakuru, with a loop to Loichar; as well as a route from Hoima to Tanga in Tanzania,” read a joint statement, which was signed by Energy CS Charles Keter.
The meeting's agenda, among other things, was to weigh on the least-cost option of the project and addressing the constructability issues along all the proposed routes.

The two leaders were also to confirm on the current proven reserves which would have an impact on the size of the pipeline.
The talks also focused on determining the viability of the ports of Lamu, Mombasa and Tanga as the potential export options as indicated in the joint resolutions.
The Ugandan President had flown into the country to meet Kenyatta over growing discontent after it emerged that Uganda had reportedly altered their initial plan to have the regional integrated pipeline pass through Kenya to Tanzania Gezaulole MK254 sam999 @Saint_Ivuga

Uhuru Fails to Agree With Museveni

 

[lenpel]

IKULU: UGANDA-TANZANIA OIL PIPELINE A DONE DEAL

By Lydia Shekighenda; 23rd March 2016.

Ikulu: PRESIDENT John Magufuli’s office categorically asserted yesterday that the agreement entered between Tanzania and Uganda for the construction of a crude oil pipeline linking the two neighbouring countries is conclusive despite ongoing jostling by Kenya for the project.

According to the acting State House director of communications, Gerson Msigwa, what appear to be increasingly desperate maneuvers by high-level officials in Kenya to try to snatch the major infrastructure project from Tanzania will eventually prove futile because the deal struck by Magufuli with his Ugandan counterpart Yoweri Museveni in Arusha recently was literally iron-clad.

“The two presidents have already sealed the deal and handed it over to experts to allow for the implementation work to proceed,” Msigwa said. “The Tanzania Petroleum Development Corporation and Ministry of Energy and Minerals are already carrying out tangible activities in relation to this project,” he added.

The agreement between Magufuli and Museveni was followed up by the signing of a project implementation plan in Arusha between responsible ministers from both countries, during which Uganda’s Energy and Minerals Development Minister, Irene Muloni, said her country was keen to fast-track the project’s implementation.

According to Msigwa, Tanzania had beaten Kenya in the race for the pipeline project primarily because of its geographical position which offers a more favourable route from Uganda’s oil fields in the Lake Albert basin to the Indian Ocean coast.

He confirmed that executives from the French company Total, which has a large stake in the Ugandan oil fields, had assured President Magufuli the $4 billion needed to build the pipeline via a preferred southern route to the Tanzanian port of Tanga was already available.
The project is expected to have a huge economic significance for Tanzania, including the creation of up to 1,500 direct and 20,000 indirect jobs.

Museveni and Kenyan president Uhuru Kenyatta are reported to have held talks in Nairobi on Monday about which route to choose for the pipeline that Kenya wants to go through its territory to Lamu port, instead of Tanga. But they did not reach any final deal.

A statement issued after Monday’s talks said the two leaders would meet again in Kampala in a couple of weeks’ time, after technical teams had further assessed factors such as security and which route would be cheaper and easier to build.

Total has already raised serious concerns about the safety of the Kenyan route which would run close to the border with Somalia, where al-Shabaab terrorists are a constant threat.

Britain’s Tullow Oil company, which has stakes in both Ugandan and Kenyan oil fields, is reportedly pressing for the Kenyan route, saying it will be cheaper for Uganda as costs will be shared between more producers. China’s CNOOC also has a stake in Ugandan oil.
Analysts said the dispute over the proposed oil pipeline route was straining relations in east Africa.

The issue appeared to have been settled in August last year after Museveni and Kenyatta signed an initial deal for the pipeline to pass through Kenya.

WHY TANZANIA IS A BETTER ROUTE THAN KENYA
Total has said it is concerned about the proposed northern route through Kenya because of the potential for attacks on the pipeline by Somalia-based al-Shabaab Islamist militants.

According to media reports from Kenya, a study by Tullow Oil and CNOOC which warned of possible delays in the completion of the oil pipeline if it went through a Kenyan route was at the centre of the talks between Kenyatta and Museveni on Monday.

Tullow Oil and CNOOC are reported to have carried out a research whose findings warned Uganda against going ahead with its original plan to use the Kenya route.

Sources said the study warned that, among other things, Kenya has a history of protracted land compensation disputes which could take years to resolve, thus further delaying the pipeline project.
The study also noted that the Lamu port in Kenya had not even been built yet, warning that it might not be completed by 2018 when Uganda expects to start exporting its crude oil.

On the other hand, Tanzania already has an established port in Tanga, which could be effectively expanded at a relatively faster speed to act as a hub for the export of Ugandan oil to international markets.

Experts said Tanzania also has experience in resolving land compensation issues quickly in order to make way for major projects, citing the successful construction of the Mtwara-Dar es Salaam natural gas pipeline and the recently-concluded land acquisition for a liquefied natural gas (LNG) plans in Lindi Region.

In Tanzania, ownership of land is vested in the president, which gives him powers to issue a decree and acquire land for the construction of projects such as the proposed pipeline.

In contrast, land in Kenya is not vested in the president, which means any pipeline construction project through that country would likely be complicated by potentially costly private land acquisition procedures.

SOURCE: THE GUARDIAN
Geza Ulole sam999 Kafrican MK254 Saint Ivuga Yericko Nyerere

 

[MK254]

IKULU: UGANDA-TANZANIA OIL PIPELINE A DONE DEAL

By Lydia Shekighenda; 23rd March 2016.

Ikulu: PRESIDENT John Magufuli’s office categorically asserted yesterday that the agreement entered between Tanzania and Uganda for the construction of a crude oil pipeline linking the two neighbouring countries is conclusive despite ongoing jostling by Kenya for the project.

According to the acting State House director of communications, Gerson Msigwa, what appear to be increasingly desperate maneuvers by high-level officials in Kenya to try to snatch the major infrastructure project from Tanzania will eventually prove futile because the deal struck by Magufuli with his Ugandan counterpart Yoweri Museveni in Arusha recently was literally iron-clad.

“The two presidents have already sealed the deal and handed it over to experts to allow for the implementation work to proceed,” Msigwa said. “The Tanzania Petroleum Development Corporation and Ministry of Energy and Minerals are already carrying out tangible activities in relation to this project,” he added.

The agreement between Magufuli and Museveni was followed up by the signing of a project implementation plan in Arusha between responsible ministers from both countries, during which Uganda’s Energy and Minerals Development Minister, Irene Muloni, said her country was keen to fast-track the project’s implementation.

According to Msigwa, Tanzania had beaten Kenya in the race for the pipeline project primarily because of its geographical position which offers a more favourable route from Uganda’s oil fields in the Lake Albert basin to the Indian Ocean coast.

He confirmed that executives from the French company Total, which has a large stake in the Ugandan oil fields, had assured President Magufuli the $4 billion needed to build the pipeline via a preferred southern route to the Tanzanian port of Tanga was already available.
The project is expected to have a huge economic significance for Tanzania, including the creation of up to 1,500 direct and 20,000 indirect jobs.

Museveni and Kenyan president Uhuru Kenyatta are reported to have held talks in Nairobi on Monday about which route to choose for the pipeline that Kenya wants to go through its territory to Lamu port, instead of Tanga. But they did not reach any final deal.

A statement issued after Monday’s talks said the two leaders would meet again in Kampala in a couple of weeks’ time, after technical teams had further assessed factors such as security and which route would be cheaper and easier to build.

Total has already raised serious concerns about the safety of the Kenyan route which would run close to the border with Somalia, where al-Shabaab terrorists are a constant threat.

Britain’s Tullow Oil company, which has stakes in both Ugandan and Kenyan oil fields, is reportedly pressing for the Kenyan route, saying it will be cheaper for Uganda as costs will be shared between more producers. China’s CNOOC also has a stake in Ugandan oil.
Analysts said the dispute over the proposed oil pipeline route was straining relations in east Africa.

The issue appeared to have been settled in August last year after Museveni and Kenyatta signed an initial deal for the pipeline to pass through Kenya.

WHY TANZANIA IS A BETTER ROUTE THAN KENYA
Total has said it is concerned about the proposed northern route through Kenya because of the potential for attacks on the pipeline by Somalia-based al-Shabaab Islamist militants.

According to media reports from Kenya, a study by Tullow Oil and CNOOC which warned of possible delays in the completion of the oil pipeline if it went through a Kenyan route was at the centre of the talks between Kenyatta and Museveni on Monday.

Tullow Oil and CNOOC are reported to have carried out a research whose findings warned Uganda against going ahead with its original plan to use the Kenya route.

Sources said the study warned that, among other things, Kenya has a history of protracted land compensation disputes which could take years to resolve, thus further delaying the pipeline project.
The study also noted that the Lamu port in Kenya had not even been built yet, warning that it might not be completed by 2018 when Uganda expects to start exporting its crude oil.

On the other hand, Tanzania already has an established port in Tanga, which could be effectively expanded at a relatively faster speed to act as a hub for the export of Ugandan oil to international markets.

Experts said Tanzania also has experience in resolving land compensation issues quickly in order to make way for major projects, citing the successful construction of the Mtwara-Dar es Salaam natural gas pipeline and the recently-concluded land acquisition for a liquefied natural gas (LNG) plans in Lindi Region.

In Tanzania, ownership of land is vested in the president, which gives him powers to issue a decree and acquire land for the construction of projects such as the proposed pipeline.

In contrast, land in Kenya is not vested in the president, which means any pipeline construction project through that country would likely be complicated by potentially costly private land acquisition procedures.

SOURCE: THE GUARDIAN
Geza Ulole sam999 Kafrican MK254 Saint Ivuga Yericko Nyerere

lenpel
In the meantime, the minister for Energy of Uganda, his Permanent secretary and their technical teams were holed up behind closed doors at the Ministry of Energy and petroleum headquarters in Nairobi. It was later revealed the cost breakdown shows that the most expensive route is Hoima to Tanga at about $5.5 billion, while a joint one with Kenya through the southern route will cost $4.4 billion (this has no Alshabaab stories) and the preferred northern route will cost $4.2 billion (the one everybody is talking about Alshabaab).

Operationally, a joint pipeline with Uganda would cost $9 a barrel to transport the crude oil while going it alone would push the cost to $14 a barrel (why Tanga route is considered expensive to operate).

Multinationals have now been put at bay, they are watching from afar, they can only advice but can't make decisions. By the way, land will be provided by Kenya, it's our responsibility.

 

[lenpel]

lenpel
In the meantime, the minister for Energy of Uganda, his Permanent secretary and their technical teams were holed up behind closed doors at the Ministry of Energy and petroleum headquarters in Nairobi. It was later revealed the cost breakdown shows that the most expensive route is Hoima to Tanga at about $5.5 billion, while a joint one with Kenya through the southern route will cost $4.4 billion (this has no Alshabaab stories) and the preferred northern route will cost $4.2 billion (the one everybody is talking about Alshabaab).

Operationally, a joint pipeline with Uganda would cost $9 a barrel to transport the crude oil while going it alone would push the cost to $14 a barrel (why Tanga route is considered expensive to operate).

Multinationals have now been put at bay, they are watching from afar, they can only advice but can't make decisions. By the way, land will be provided by Kenya, it's our responsibility.

source please, not here says...!!! MK254