The leaders of Tanzania and Uganda laid a foundation stone on August 5 for the construction of a $3.55-billion-crude export pipeline that would pump Ugandan oil for international markets. The 1 445 km-project will stretch from western Uganda, where crude reserves were discovered in 2006, to Tanzania's seaport Tanga.
Guy Maurice, Senior Vice President of Africa at Total Exploration and Production, said the project will become “the longest electrically heated crude oil pipeline in the world”. Total is one of the owners of Ugandan oilfields, alongside China’s Cnooc and Britain’s Tullow Oil.
Uganda estimates overall crude reserves at 6.5-billion barrels, while recoverable reserves are seen at between 1.4-billion and 1.7-billion barrels. Kampala said it picked Tanzania over Kenya as the route for the proposed 24-inch export pipeline because it was less expensive and less risky. Museveni said that Tanzania had offered several compromises to make the pipeline profitable despite the falling global crude oil prices. Tanzania agreed to remove taxes, offered to take up shares in the pipeline project and charge a tariff of $12.2 per barrel to make the project feasible, he added.