East Africa
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East African Community moots oil pipeline links

Burgess COMMENTARY

Peter Burgess

East African Community moots oil pipeline links

KIGALI, Rwanda – There are plans to link the East African Community member states with oil pipelines to exploit the discoveries of crude oil around the region.

While officially opening the 7th East African Petroleum Conference and Exhibition (EAPCE 15) in Kigali last week Rwanda’s Premier, Anastase Murekezi said, “The East African Community is giving very high priority to the development of infrastructure and energy and in the petroleum sector, plans are in place to link all the EAC partner States with oil products pipeline which will facilitate access to the oil resources discovered in the region as well as imports for the international markets.”

The conference brought together over 600 participants from international oil companies, oil industry service companies, government institutions, academic institutions, international geoscientific journals, non-oil and gas institutions and the media.

Murekezi said, “Prequalification of contractors for the construction of Eldoret-Kampala-Kigali pipeline has been completed. Preparation work for extending the project to Bujumbura, are also set to commence soon following the securing of funding for feasibility studies for the Kigali-Bujumbura section.”

“This oil pipeline network will be linked to the United Republic of Tanzania from a hub in Mbarara (Uganda) with a pipeline to Mwanza, Isaka and finally to Dar es Salaam,” he said.

He said, “The infrastructure and energy projects that are being implementing are estimated to cost $100 billion over the next 10 years as capital costs and $500 million in the next three to four years in project preparation costs covering required studies, project packaging and promotions, and transaction advisory costs.”

The EAC is committed to the provision of sufficient, reliable and affordable electricity.

“This is why Rwanda is developing methane gas-to-power projects, Uganda is developing major hydro power projects, Kenya is developing geothermal and Tanzania is developing natural gas to power projects,” the Premier said.

Murekezi said, “We are then linking all the Partner States with high voltage transmission lines and developing the necessary framework for power exchange and trade amongst all Partner States.”

Last year alone, the region has commissioned over five hundred megawatts of new generation capacity which will see the region’s installed capacity grow from the current 4,000 megawatts to more than 12,000 megawatts by 2018.

“Given the huge capital requirements, the input of both public and private sectors is necessary in the implementation of these projects,” he said and asked the private sector, Development Partners and all stakeholders in the energy sector to partner with EAC governments in these efforts.

The Premier said EAPCE is a golden opportunity for members of the East African Community since it helps them to deeply reflect on the role that the energy sector plays in the development of our economies. “It also helps us to promote investment in the oil and gas sector by demonstrating to the world the potential that lies within the region and sharing information on the status of development of the sector in each Partner State, thereby harnessing Petroleum Potential and Investment opportunities in the East African Region,” he said. “This conference held every two years since 2003 has attracted interest worldwide and has become an important feature in the international oil and gas calendar of events. It has also immensely contributed in putting the East African Community on the global map as far as upstream oil and gas activities are concerned,” Murekezi said.

He said, “The enormous energy and natural resources that this region is endowed with can be optimally developed through cooperation among Partner States and other development partners, calling on all members of the East African Community to always join their efforts in the development of oil and gas sector. Our priorities should be on exploration, production, refining, and storage and pipeline development for product transportation.

“It is only through taking up a bold regional approach that EAC can develop such infrastructures that a single country in EAC cannot afford as they require lots of money,” Murekezi said.

Implementation of a 60,000 barrels-per-day refinery is one of the region’s major flagship projects in the development of the resources discovered in the region.

The refinery is a Public-Private-Partnership project into which the Uganda government and other EAC Partner States own a stake. This is a clear demonstration of the commitment of Partner States to jointly develop their energy and natural resources for the benefit of the region.

The first stage, which is to produce 30,000 barrels per day, is scheduled for commissioning in 2018. The refinery will be located in Hoima in the Albertine Graben with a products pipeline to Kampala to feed the network of oil pipelines to supply the region.

The region also plans to develop a crude pipeline project from the Albertine Graben and Turkana to the new Lamu port that the Republic of Kenya is developing under the LAPSSET (Lamu Port South Sudan Ethiopia) project.