The construction of the $4 billion (8 trillion/-) Tanga-Uganda oil pipeline is scheduled to begin in August this year and be completed within three years, the state-run Tanzania Petroleum Development Corporation (TPDC) has announced.
Speaking to reporters in Dar es Salaam yesterday, TPDC executive director James Mataragio said the project will be carried out by three international oil firms –Tullow Oil plc (Britain), Total E&P (France), and Cnooc (China).
“We are working round the clock to enable the project to commence and proceed according to schedule,” Mataragio said.
“It is anticipated that thousands of tons of bare pipes, materials and equipment for pipe insulation, pump, bulk heating and trace heating stations will be imported through Tanga port,” he added.
The 1,403-kilometer pipeline will wind its way from Tanga to Uganda through Singida and Kagera regions, and upon completion will be able to transport up to 200,000 barrels of oil per day, according to the project blueprint.
It will link oil fields in Uganda's Lake Albert, Hoima region to the Tanga port which will serve as an export hub.
So far the investors are working on the best deal to transport to Tanga an estimated 6.5 billion barrels of oil believed to be accessible in Lake Albert. Already 1.4 -1.7 billion barrels have been confirmed as recoverable and available for transportation.
The TPDC boss noted that the pipeline project is also expected to increase Foreign Direct Investment (FDI) to Tanzania by more than 50 per cent per annum.
Its presence will pave the way for the installation of an estimated 200 kilometers of permanent new roads and corresponding bridges, and the upgrading of a further 150km of existing roads, while also presenting local companies like Tanzania Railways Limited with “very good business opportunities”, he added.
The pipeline should furthermore speed up regional integration in the energy sub-sector taking into consideration that Uganda is also in need of natural gas from Tanzania to power its iron core processing plants, Mataragio pointed out.
On the issue of compensation payments to the owners and occupiers of land through which the pipeline is set to pass, the TPDC boss said all such payments would be made before the project begins.
The pipeline deal was effectively sealed by presidents John Magufuli of Tanzania and his Ugandan counterpart Yoweri Museveni on the sidelines of the East Africa Community (EAC) Heads of State summit in Arusha last week.
Museveni applauded Magufuli for his alacrity and zeal in implementing projects, a factor seen by some observers as a major reason why Uganda picked Tanzania as its pipeline project partner ahead of initial frontrunners Kenya.
The proposed Kenyan route for the pipeline had also raised concerns over the fact that it would run through a region where Al-Shabaab Islamist militants from Somalia are known to be regularly active.
Kenya had even expressed plans to build a new port to serve the region alongside the pipeline.
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