Uganda: Pipeline meeting called off over Magufuli death

The high-profile meeting previously scheduled for today to sign off the remaining key agreements for commercialisation of the proposed East African Crude Oil Pipeline (EACOP) has been deferred to allow the mourning of fallen Tanzanian President John Pombe Magufuli, sources have revealed.
Magufuli, 61, died on Wednesday last week  due to heart complications.

During the meeting, Uganda, Tanzania and Total SA - the parent company of Total E&P, the lead developer of the pipeline - were slated to sign the shareholders, tariff, and transportation agreements, respectively for EACOP.

The shareholders agreement details the structure of the 1,443km pipeline from Hoima in mid-western Uganda to Tanzania’s Indian Ocean port of Tanga.
 
Total E&P owns majority shares in the project of 72 per cent, followed by Uganda through Uganda National Oil Company (Unoc) with 15 per cent, Chinese oil company—Cnooc with eight per cent, and Tanzania through its national oil company, TPDC, with five per cent.

Uganda’s 15 per cent stake is in sync with the 15 per cent stake in the production licences for each of the oil fields operated by Total E&P and Cnooc.

The tariff agreement details the economics of fees for transportation of crude oil from Hoima through Tanga port, while the transportation agreement deals with shipment of the oil from Tanga to the international market.

The initialing of the three agreements is expected to pave way for Final Investment Decision (FID), when Total E&P and Cnooc are expected to announce capital—at least $10b (Shs36 trillion) to kick-start the next development phase leading to commercial oil production, tentatively by 2025; $6.7b (about Shs24 trillion) for developing the oil fields—Tilenga fields in Nwoya/Buliisa districts and Kingfisher, and $3.8b (Shs13.8 trillion) for developing the EACOP.

Daily Monitor Uganda.