Ugandan President Yoweri Museveni and Tanzanian President John Magufuli witnessed the signing of an agreement that paved the way for the construction of the EACOP on Sunday, 13th September 2020, in Chato, Tanzania.

This is for construction of a 1,445 kilometres Hoima-Tanga crude oil pipeline called the “East African Crude Oil Pipeline (EACOP)”. Both presidents witnessed the signing in Chato District, Geita Region, which will see crude oil transported from Ugandan oilfields to the Tanga port in Tanzania.

The project is estimated to cost about $3.5 billion and the construction is expected to commence in 2021. Speaking after the signing, the President of Uganda said the project must commence as soon as possible for the people of both countries to start enjoying the fruit of the resources.

He said the project will exploit about 6.5 billion barrels of oil. Tanzania is to get 60% of the profit while Uganda gets the other 40%. According to him, the delay in the project has been due to debates and negotiations between Uganda and other relevant stakeholders on tax and other expenses.

He also noted that Uganda had to forego $800 million revenue that was to be collected from the project for the next 25 years, to allow the timely commencement of the project. He also promised to liaise with his Tanzanian counterpart to resolve other pending issues and ensure the Host Government Agreement is signed in Tanzania.

Last week, Uganda signed the Host Government Agreement with French oil and gas giant, Total. A statement by Total Uganda read, “The conditions are set for the ramp-up of project activities and in particular, we will resume the land acquisition activities in Uganda while respecting the highest human rights standards.”

The president said the project will make fuel cheaper in the country and promote the aviation industry as regional airlines will get cheaper jet fuel.

Excerpts from the Ugandan President’s live broadcast:

“Since we discovered the oil in Uganda, there has been a lot of debate and negotiations on terms to be applied, it’s good that all these have come to an end and now, we are ready for the project.”

“The oil will be explored from the area covering 40 per cent of the total area that has been discovered to have that natural wealth, we have decided to start with it since it’s just the new area of investment.”

“Since it’s a new area, we decided to use the small area from where we will also be able to learn more for the sake of doing better in the next project.”

In Tanzania, the pipeline is to pass through 8 regions, 24 districts and 123 wards; the  Kagera, Geita, Shinyanga, Tabora, Singida, Dodoma, Manyara and Tanga regions.