Uganda Granted License to Construct New Crude Pipeline

The cabinet approval for the crude oil pipeline project will help in significant development of oilfields in the country, hoped Godfrey Kabbyanga, the state minister for information.

SEATTLE (Oil Monster): Uganda has granted license to construct a $3.5 billion crude oil pipeline, which is expected to boost the transportation of the country’s oil to key international markets. The proposed pipeline will run a distance of 1,445 kilometres from western Uganda to a port on Tanzania's Indian Ocean coast.

The application for construction license was submitted by the East African Crude Oil Pipeline Company Ltd (EACOP) - a company controlled by France-based TotalEnergies.

The East African country of Uganda has been facing delay in commercial production of oil from its oilfields for more than two decades, mainly on account of standoff between the government and oil companies over tax sharing. The lack of infrastructure too has been a contributing factor to the delay. The cabinet approval for the crude oil pipeline project will help in significant development of oilfields in the country, hoped Godfrey Kabbyanga, the state minister for information.

TotalEnergies hold the majority stake of 62% in EACOP. Other shareholders include the state-run Uganda National Oil Company and Tanzania Petroleum Development Corporation, who own 15% share each. Meantime, the remaining 8% is held by Chinese CNOOC.