Uganda targets 2027 start for world’s longest heated oil pipeline

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The world’s longest heated oil pipeline is “still viable” and will be operational in the next three years despite financing delays blamed on activists’ protests, according to a Ugandan minister who defended the country’s development of fossil fuels.

“The east African crude oil pipeline is ongoing,” Uganda’s energy minister Ruth Nankabirwa told the Financial Times at the COP29 climate summit in Baku, Azerbaijan. “We have invested a lot of money in exploring exploration [and] in critical infrastructure. We are now drilling.”

Uganda is set to become an energy producer by 2027, allowing the landlocked nation to export oil from two oilfields via a $4bn, 1,443km-long pipeline that would run through Tanzania to the port of Tanga. The developments will transform east Africa’s energy market but have been criticised for displacing communities and damaging the environment.

TotalEnergies alongside China’s Cnooc is leading the project alongside the Ugandan and Tanzanian national oil companies to develop the Kingfisher and Tilenga fields close to Lake Albert. Drilling has begun at both sites and the pipeline’s construction is already under way.

Once fully operational, Uganda expects to produce 230,000 barrels a day of oil — higher than Opec member Gabon’s output — with 60,000 b/d refined for domestic use. The remaining 170,000 b/d will be exported through the pipeline, which will be electrically heated to help pump Uganda’s thick and viscous crude grades.

Ever since oil was discovered in the Albertine rift basin near the Democratic Republic of Congo 18 years ago, Uganda’s long-serving president Yoweri Museveni has hoped it will propel the country into upper middle-income status. 

“Developing countries that have good deposits of fossil fuel are seeing that as an opportunity, once exploited, to get money for social and economic development,” said Nankabirwa.

Many African countries face a conundrum over whether to boost their economies through fossil fuel investments at a time when the continent is experiencing the devastating effects of climate change. 

The pipeline will cross nature reserves along the basin of Lake Victoria, Africa’s largest, while displacing households and wildlife across Uganda and Tanzania, say activists who are sceptical the projects will benefit local communities.

Several organisations have held regular protests against the project in defiance of a government known for stifling political free speech and dissent.

“Ugandan authorities have intensified their repression of activists protesting the oil projects in the country’s Lake Albert region,” said the International Federation for Human Rights, which in September documented at least 81 arrests and detentions since May.

Nankabirwa pushed back against criticism of the government. “They have failed to appreciate why countries like Uganda are involved in such projects. They have told lies that we have displaced animals and people,” she said.

“Climate change issues” meant the oil venture ran into financing roadblocks, Nankabirwa added. Standard Chartered last year pulled out of financing the pipeline after the lender became a target for environmental activists.

The project’s equity-debt split has been changed from 40/60 to 52/48 she said, adding that stakeholders were expected to receive the debt financing from several international institutions, including the Export — Import Bank of China, next month.

The minister said the pipeline would operate for 25 years. “If it wasn’t for the injustice that has been done to it, we would be talking about seeing our first oil in 2025. But because of the campaigns against it, we are not going to see the first oil next year. So we expected to run into 2026, 2027.”

Dickens Kamugisha, head of the Africa Institute for Energy Governance in Kampala, which works with affected communities, said the Uganda-Tanzania project “will lock east Africa into fossil fuel dependency for decades”.

The scheme’s backers counter that Africa should be allowed to exploit its oil and gas resources because the continent has hardly contributed to rising global carbon dioxide emissions.

The project would boost both Uganda and Tanzania’s economic output, Nankabirwa said. But she cautioned that Uganda “cannot be careless” while exploiting its fossil fuel resources as it “suffers equally” with other countries from the effects of climate change.