Uganda seeks Chinese support for EACOP

Uganda is currently in the advanced stages of talks with Chinese financiers to secure funding for a pipeline project that has sparked controversy.

Permanent secretary at the Energy Ministry, Irene Bateebe said discussions are still underway to finance the construction of Eacop. “We are having final discussions with our Chinese partners to provide about half of the finances required for the construction of the Eacop (East African Crude Oil Pipeline)” she said.

“We should be concluding the arrangements with the Chinese financiers this coming month (October),” she added.

French energy giant TotalEnergies is leading a multi-billion-dollar project to develop Ugandan oilfields and ship the crude through a 1,445-kilometre (900-mile) pipeline to a port in Tanzania.

The government has vowed to plough ahead despite the opposition, and TotalEnergies says those displaced by the project have been fairly compensated and measures have been taken to protect the environment.

Bateebe believes the project is a significant one for Uganda.

“Some of our international partners from Europe were forced to pull out from financing this project and as a country, we sourced for other friendly partners to finance the balance of the financing and we are on course” she said.

TotalEnergies has a 62 percent stake in the pipeline, with Ugandan and Tanzanian state-owned oil companies holding 15 percent each and China National Offshore Oil Corporation eight percent.

The pipeline is part of a $10 billion project to develop oilfields in Lake Albert in Northwestern Uganda and export the crude to international markets via the Indian Ocean port of Tanga in Tanzania.

The lake lies atop an estimated 6.5 billion barrels of crude, of which about 1.4 billion barrels are currently considered recoverable.

Uganda anticipates the commencement of its inaugural oil production in 2025, a significant milestone occurring nearly two decades after the initial discovery of oil reserves. President Yoweri Museveni has characterized this project as a crucial economic opportunity for Uganda, a landlocked nation where a substantial portion of the population grapples with poverty.