Kenya fights to rescue Sh400b pipeline deal


Kenya will send a delegation to Uganda to try and rescue the Sh400 billion crude oil pipeline deal that her Ugandan counterpart seems to have sealed with Tanzania.

This comes even as it emerged that the Uganda government may have moved on and selected the second alternative via Tanzania, a decision that will be a major setback for Kenya. Mr Kamau said the there were four main contentions issues, among them security, funding of the pipeline, the lowest cost tariff and the speed of construction.

But recent reports indicate that President Yoweri Museveni may have opted for the alternative route after he met Total executives at Uganda’s State House in July 2015. Total is also said to have exploration interests around Lake Eyasi, North Tanzania, making the Tanga route a better alternative for the company.

Since that meeting, Uganda has been sending mixed signals to Kenya on the deal and hinting that a different pipeline will be passing through Tanzania’s Tanga.

And despite this shift, the Kenyan president and his Ugandan counterpart went ahead to announce in August last year that the pipeline would pass through Albertine to Lokichar in Turkana County. But a statement by Tanzania’s presidential press unit last week deepened the mystery around the project after it stated that President John Pombe Magufuli met Museveni, and agreed that the pipeline would pass through Tanga.

The  two heads of state had agreed to begin construction of the crude oil pipeline from Tanga to Uganda, for the benefit of the two countries and their East African counterparts. “The pipeline will be 1,120km long and the project will create employment for over 15,000 people,” the statement said.

But some Ugandan and Kenyan officials have dismissed the deal (Uganda-Tanga route) on grounds that that Tanzania is not a member of the Northern Corridor Integration Projects summit (NCIP), hence the project cannot take the Tanga route.

It has also emerged that Kenya will now transport its early crude oil from Turkana to Eldoret by road. “We shall move the early oil by road from Lokichar to Eldoret and then move it by railway to the port. This is not the first time this is happening in the world,” Kamau said, adding that plans are already underway to build the road infrastructure to Lokichar in Turkana County.

Kamau who was speaking after the launch of the Energy Journalism Excellence Awards (EJEA) awards also maintained that  the deal is expected to continue as planned.

Standard Media.

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