Total E&P has signed a separate Host Government Agreement (HGA) for the proposed East African Crude Oil Pipeline (EACOP) with the Tanzanian government. The signed agreement is key to the commencement of the construction of the crude oil pipeline from Uganda to the Tanga port in Tanzania.
The Agreement highlights the rights and obligations of the government, the duties of the investors, the environmental and other relevant standards, liability, legal framework, arbitration and closure of the project. Itwas signed on Monday, 27th October 2020, in Dodoma at a ceremony presided over by President John Pombe Magufuli of Tanzania and attended by top government officials and Executives of Total.
The Attorney General of Uganda, Professor Adelardus Kilangi, signed the HGA for Tanzania while Nicolas Terraz signed on behalf of Total. After signing, Prof Kilangi said “this is an important milestone towards the implementation. It represents yet another successful step in the process.”
Total described the agreement signing as “an important milestone towards implementation of EACOP.”
The French major signed its HGA with Uganda in September. After the signing of the agreement in Uganda, President Museveni of Uganda and Ugandan oil technocrats flew to Tanzania to hold discussions with their Tanzanian counterparts and signed a communique of endorsement of the principles of the agreement.
The signing of the Agreement allows for the commencement of negotiations for the other agreements – the Shareholders Agreement and the Transportation and Tariff Agreement.
The Final Investment Decision (FID) for the development of the oil fields and the EACOP is to be reached between the Ugandan government and the oil companies – Total and CNOOC, by December 2020 or latest by the end of January 2021.
The construction of the pipeline is to commence in the first quarter of 2021 and will last for 3 and a half years.