Geza Ulole
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- Oct 31, 2009
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When JPM stepped in to advice a dear brother
South Sudan is in negotiation with Uganda and Tanzania to use Hoima-Tanga pipeline after DRC Congo
South Sudan is in negotiation with Uganda and Tanzania to use Hoima-Tanga pipeline after DRC Congo
- Thread starter Geza Ulole
- Start date
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #62
Meanwhile
By MACHARIA KAMAU | September 10th 2020 at 12:00:00 GMT +0300
The government appears to have made major concessions for Tullow Oil and its joint venture partners, which may have led the oil companies to withdraw notices stopping work back in May.
The firm and its partners had issued force majeure (unforeseeable circumstances that prevent someone from fulfilling a contract) notices in May, citing Covid-19 restrictions among the factors that made it difficult to deliver on their obligations as set out in the oil production-sharing contracts.
The companies also cited recent tax changes that they said adversely impacted the project.
This resulted in a three-month stoppage of works at Lokichar in Turkana County. However, the companies withdrew the notices last month.
It has now emerged that the decision could have come on the back of major concessions by the government.
Tullow yesterday said it lifted the notices following discussions with its partners and the government, in which the latter gave the companies an extension on their exploration licences to the end of 2021. Thereafter, they are expected to get production licences.
They also got an extension on their tax holidays. The firm noted that the three-month period when little or no activities took place could affect the timelines for Kenya’s oil project, with key decisions that were expected to come later this year and move the project to its commercial phase now facing delays.“Following productive discussions with the government, an improvement in the Covid-19 situation and assurances from the government that the tax incentives granted to the phased project will continue to apply, the force majeure notices were withdrawn in August 2020,” said Tullow while announcing its half-year results to June.
Charles Wanguhu, the co-ordinator of the Kenya Civil Society Platform on Oil and Gas (KCSPOG), said the three-month hiatus in Tullow operations would delay the start of the commercial phase for the project. This means Kenya could at best expect to start oil exports in 2024.
This is from an earlier optimistic target of 2022, which was later revised to 2023.
Wanguhu added that the government has made major concessions in the oil deal, and the declaration of force majeure in May could have been a strategy by the companies to get the government to yield to their demands.
“The likely implication is a further delay on FID (final investment decision) on the project too late 2021. In reality, Kenya would then be waiting till 2024 at the earliest for first oil,” he said in a statement.
“Overall, force majeure would appear to have been used as a strong-arm tactic by the joint venture partners to gain better terms.”
State gave Tullow tax breaks and new licence to save oil plan
How State saved Tullow deal with tax holiday, new licences
By MACHARIA KAMAU | September 10th 2020 at 12:00:00 GMT +0300
The government appears to have made major concessions for Tullow Oil and its joint venture partners, which may have led the oil companies to withdraw notices stopping work back in May.
Tullow yesterday said it had received tax holidays and an extension on its exploration licences.The firm and its partners had issued force majeure (unforeseeable circumstances that prevent someone from fulfilling a contract) notices in May, citing Covid-19 restrictions among the factors that made it difficult to deliver on their obligations as set out in the oil production-sharing contracts.
The companies also cited recent tax changes that they said adversely impacted the project.
This resulted in a three-month stoppage of works at Lokichar in Turkana County. However, the companies withdrew the notices last month.
It has now emerged that the decision could have come on the back of major concessions by the government.
Tullow yesterday said it lifted the notices following discussions with its partners and the government, in which the latter gave the companies an extension on their exploration licences to the end of 2021. Thereafter, they are expected to get production licences.
They also got an extension on their tax holidays. The firm noted that the three-month period when little or no activities took place could affect the timelines for Kenya’s oil project, with key decisions that were expected to come later this year and move the project to its commercial phase now facing delays.“Following productive discussions with the government, an improvement in the Covid-19 situation and assurances from the government that the tax incentives granted to the phased project will continue to apply, the force majeure notices were withdrawn in August 2020,” said Tullow while announcing its half-year results to June.
Charles Wanguhu, the co-ordinator of the Kenya Civil Society Platform on Oil and Gas (KCSPOG), said the three-month hiatus in Tullow operations would delay the start of the commercial phase for the project. This means Kenya could at best expect to start oil exports in 2024.
This is from an earlier optimistic target of 2022, which was later revised to 2023.
Wanguhu added that the government has made major concessions in the oil deal, and the declaration of force majeure in May could have been a strategy by the companies to get the government to yield to their demands.
“The likely implication is a further delay on FID (final investment decision) on the project too late 2021. In reality, Kenya would then be waiting till 2024 at the earliest for first oil,” he said in a statement.
“Overall, force majeure would appear to have been used as a strong-arm tactic by the joint venture partners to gain better terms.”
State gave Tullow tax breaks and new licence to save oil plan
THE BOILER ROOM
JF-Expert Member
- Sep 17, 2018
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Dah siku tukigundua mafuta yetu especially kule kaskazini mashariki hata majirani zetu watakuja kupumzika kwetu maana napata mstuko kuona China anataka kuweka military base Kenya,tushishangae kuona bendera ya kigeni ikipepea Mombasa na ulinzi mkali wa kigeni juu yake pia. Mtego umenasa !!!
Geza Ulole
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- Oct 31, 2009
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- #64
Why Kenya lost Uganda pipeline deal
What you need to know:
- Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania’s Tanga port.
- The fact that the Tanga port was already operational gave it an edge over Lamu, which is still under construction.
The deal signed on Sunday between President John Magufuli and his Ugandan counterpart Yoweri Museveni will see Kampala route its oil exports through Tanzania, through the 1,445-kilometre crude oil pipeline.
President Magufuli said after inking the deal in his home town of Chato that the project “is very crucial for our people”.
"Our signing today is a crucial step towards implementing the project which will not only create jobs, but also promote cooperation within the region, and stimulate economic development in areas the pipeline crosses,” President Magufuli said.
For his part, President Museveni said: "We want our people to work fast and start this project."
The construction is expected to start before the end of the year and it will help Uganda exploit oil discovered near Lake Albert in 2006.
Reserves in the area are conservatively estimated at some 1.7 billion barrels.
Cheaper
Oil firm Total, alongside China's CNOOC, will do the construction, supported by the governments of Uganda and Tanzania.
Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania’s Tanga port.
President Museveni’s government also said the Kenyan route would delay the project, as it lacked roads and was always affected by monsoon winds for up to three months annually.
A report by Ugandan experts also concluded it was harder to secure land in Kenya, since it takes about 24 months to compensate land owners and get down to work.
On the contrary, since the Tanzanian government owns all the land, access would be easier.
The other deal breaker for Kenya was security. Lamu is seen as closer to Somalia on the Indian Ocean than Tanzania, feeding into fears that the pipeline could be a target for Al-Shabaab.
The fact that the Tanga port was already operational gave it an edge over Lamu, which is still under construction.
Kenya had banked on Uganda to join hands in building the critical infrastructure, which has been blamed for the delays in commercialisation of its oil finds.
Sh121.45 billion pipeline
Abandoned, Kenya will now go it alone, and has maintained it will build its Sh121.45 billion pipeline from Lokichar, where it struck oil in Turkana County, to Lamu, where it is building its port.
Budget estimates show that the State Department for Petroleum plans to spend Sh648.5 million in the financial year starting July 1 on the oil pipeline, commonly known as Project.
The allocation is in addition to the Sh777.5 million allocated in the current financial year to undertake research, feasibility studies, project preparation and design for the project.
Official timelines now show that Kenya’s pipeline will be completed in the second half of 2023 and not June 2022, as earlier planned.
The pipeline project is under a joint partnership between the Kenya government and the oil companies’ consortium of Tullow Oil Kenya B.V, Africa Oil Turkana Ltd and Total Oil (formally Maersk Oil).
Ironically, French Oil giant Total, which is also eyeing to do the Kenyan pipeline, has widely been seen as having had a hand in the decision by Uganda to change its route from its major trading partner.
This comes shortly after Total, the majority shareholder in Uganda's oil fields, reached an agreement on the pipeline with Uganda's government.
Tanzania government spokesman Hassan Abassi said about 80 percent of the pipeline will run through Tanzania and the project is expected to create more than 18,000 jobs for Tanzanians.
pwafula@ke.nationmedia.com
Why Kenya lost Uganda pipeline deal
eliakeem
JF-Expert Member
- May 29, 2009
- 17,214
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Why Kenya lost Uganda pipeline deal
Tuesday, September 15, 2020
Workers on a Kenya Pipeline Company extension project. Uganda signed a crude oil pipeline agreement with Tanzania to explore the Tanga route.
File | Nation Media Group
By Paul Wafula
What you need to know:
Nearly four years after Uganda abandoned Kenya in building an oil pipeline that would have transported its oil to Lamu, it has now officially signed a Sh410 billion ($3.5 billion) deal with Tanzania, leaving Nairobi to walk alone.
- Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania’s Tanga port.
- The fact that the Tanga port was already operational gave it an edge over Lamu, which is still under construction.
The deal signed on Sunday between President John Magufuli and his Ugandan counterpart Yoweri Museveni will see Kampala route its oil exports through Tanzania, through the 1,445-kilometre crude oil pipeline.
President Magufuli said after inking the deal in his home town of Chato that the project “is very crucial for our people”.
"Our signing today is a crucial step towards implementing the project which will not only create jobs, but also promote cooperation within the region, and stimulate economic development in areas the pipeline crosses,” President Magufuli said.
For his part, President Museveni said: "We want our people to work fast and start this project."
The construction is expected to start before the end of the year and it will help Uganda exploit oil discovered near Lake Albert in 2006.
Reserves in the area are conservatively estimated at some 1.7 billion barrels.
Cheaper
Oil firm Total, alongside China's CNOOC, will do the construction, supported by the governments of Uganda and Tanzania.
Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania’s Tanga port.
President Museveni’s government also said the Kenyan route would delay the project, as it lacked roads and was always affected by monsoon winds for up to three months annually.
A report by Ugandan experts also concluded it was harder to secure land in Kenya, since it takes about 24 months to compensate land owners and get down to work.
On the contrary, since the Tanzanian government owns all the land, access would be easier.
The other deal breaker for Kenya was security. Lamu is seen as closer to Somalia on the Indian Ocean than Tanzania, feeding into fears that the pipeline could be a target for Al-Shabaab.
The fact that the Tanga port was already operational gave it an edge over Lamu, which is still under construction.
Kenya had banked on Uganda to join hands in building the critical infrastructure, which has been blamed for the delays in commercialisation of its oil finds.
Sh121.45 billion pipeline
Abandoned, Kenya will now go it alone, and has maintained it will build its Sh121.45 billion pipeline from Lokichar, where it struck oil in Turkana County, to Lamu, where it is building its port.
Budget estimates show that the State Department for Petroleum plans to spend Sh648.5 million in the financial year starting July 1 on the oil pipeline, commonly known as Project.
The allocation is in addition to the Sh777.5 million allocated in the current financial year to undertake research, feasibility studies, project preparation and design for the project.
Official timelines now show that Kenya’s pipeline will be completed in the second half of 2023 and not June 2022, as earlier planned.
The pipeline project is under a joint partnership between the Kenya government and the oil companies’ consortium of Tullow Oil Kenya B.V, Africa Oil Turkana Ltd and Total Oil (formally Maersk Oil).
Ironically, French Oil giant Total, which is also eyeing to do the Kenyan pipeline, has widely been seen as having had a hand in the decision by Uganda to change its route from its major trading partner.
This comes shortly after Total, the majority shareholder in Uganda's oil fields, reached an agreement on the pipeline with Uganda's government.
Tanzania government spokesman Hassan Abassi said about 80 percent of the pipeline will run through Tanzania and the project is expected to create more than 18,000 jobs for Tanzanians.
pwafula@ke.nationmedia.com
Why Kenya lost Uganda pipeline deal
The undesputable facts about the kenya's deal breaker.
1. Lamu is attacked by monsoon wind for Three months a year.
2. Lamu port is still under construction, no one knows when is really going to be commissioned. Leave alone the ActionPlan.
3. It is very challenging to secure the way leave for the pipeline in kenya in terms of time, cost and legal issue. I think everyone remembers what happened during acquisition of land for sgr kenya.
4. Security threat, is also a major reason to move to Tanga. The port espectially the oil facilities will be the place to quench for al shabab's anger.
I think everyone is now content on why the pipeline should be executed in Tanzania. We welcome the South Sudan and Kenya to join hand in the project so as to enjoy the goodness and beauty of the eac bloc.
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
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- Thread starter
- #66
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #67
What the crude oil pipeline means to Tanzania
THURSDAY SEPTEMBER 17 2020
In Summary
Dar es Salaam. Tanzanian authorities have one month in which to conclude and sign the Host Government Agreement (HGA) with upstream firms involved in the East African Crude Oil Pipeline (EACOP). The country expects billions of dollars from the joint project with Uganda.
The upstream firms include Total, CNOOC and UNOC.
This is what those involved in the HGA in Tanzania have been told, according to EACOP’s National Coordinator in Tanzania, Mr Salum Mnuna.
The $3.5 billion pipeline will transport crude oil from Hoima in Uganda to Tanga port in Tanzania.
The directive to have the HGA signed within a month comes after President John Magufuli and Uganda President Yoweri Museveni met on Monday, September 14 and signed an intergovernmental agreement (IGA) to fast-track the requisite legal and commercial agreements.
It also comes after the signing of an HGA by Uganda.
Completion of the HGA and the existing legal procedures would pave the way for a Final Investment Decision (FID), expected by the end of this year.
The two Presidents agreed that each nation commences negotiations on all pending project issues immediately.
“The directive has been issued after the signing of the IGA this week,” revealed Mr Mnuna.
So far, Tanzania has completed the Environmental and Social Impact Assessment (ESIA) for the project, among other prerequisites.
Referring to the financial gains that Tanzania will get from the pipeline project, Mr Mnuna said the country would earn $1 billion a year (about Sh2.3 trillion) as income tax for the next 25 years.
The revenues will be generated on the start of the pipeline operations, whereby Tanzania will earn 60 percent of the paid tax - with Uganda pocketing 40 percent.
“There will be other financial gains that we will get from the project - apart from tax,” Mr Mnuna revealed.
He also disclosed that the Tanzanian authorities had granted the oil companies a VAT exemption on imported construction equipment like heavy machineries in order to facilitate construction of the pipeline which will have the capacity to transport 216Kbd: that is some 216,000 barrels of oil per day.
He added that contracted Ugandan shippers will pay $12.77 per barrel to EACOP Company for transporting crude oil from the production site to international markets.
As it stands in terms of the share-holding structure for the oil project, the up-streamers include Total Oil (66.7 percent after acquiring Tullow’s 33.3 share) and the China National Offshore Oil Corporation (CNOOC), with 33.3 percent shares. However, the Uganda National Oil Company (UNOC) will soon join the upstream stakeholders, holding 15 percent, Total oil stated.
During the construction phase, the 1,445km-long pipeline will create employment in the form of thousands of jobs throughout the pipeline’s route - and will unlock East Africa’s potential as it will result to over 60 percent increase in Foreign Direct Investments (FDIs) in Uganda and Tanzania.
During his recent visit to Chato in Tanzania, Uganda President Museveni said the project is set to exploit 6.5 billion barrels of oil. This is only 40 percent of the estimated deposits that has been discovered in the Albertine oil zone.
He further revealed that there had been lengthy debate and negotiations between Uganda and other stakeholders on the amount of tax and other expenses - processes which delayed commencement of the project for years.
For his part, President Magufuli revealed that the oil pipeline project will create more than 15,000 jobs for Tanzanians. Also he expressed optimism that the project’s implementation will open up the region for further trading opportunities - which would, in turn, fast-track socioeconomic development in the region.
The oil pipeline will start in the Buseruka sub-county, Hoima District, to Tanga. Tanzania hosts 1,115km of the pipeline (80 percent) with the remaining 330km being in Uganda.
What the crude oil pipeline means to Tanzania
MY TAKE
Gas revenues to heat the waxy crude oil from Uganda not factored in!
THURSDAY SEPTEMBER 17 2020
In Summary
- The $3.5 billion pipeline will transport crude oil from Hoima in Uganda to Tanga port in Tanzania.
Dar es Salaam. Tanzanian authorities have one month in which to conclude and sign the Host Government Agreement (HGA) with upstream firms involved in the East African Crude Oil Pipeline (EACOP). The country expects billions of dollars from the joint project with Uganda.
The upstream firms include Total, CNOOC and UNOC.
This is what those involved in the HGA in Tanzania have been told, according to EACOP’s National Coordinator in Tanzania, Mr Salum Mnuna.
The $3.5 billion pipeline will transport crude oil from Hoima in Uganda to Tanga port in Tanzania.
The directive to have the HGA signed within a month comes after President John Magufuli and Uganda President Yoweri Museveni met on Monday, September 14 and signed an intergovernmental agreement (IGA) to fast-track the requisite legal and commercial agreements.
It also comes after the signing of an HGA by Uganda.
Completion of the HGA and the existing legal procedures would pave the way for a Final Investment Decision (FID), expected by the end of this year.
The two Presidents agreed that each nation commences negotiations on all pending project issues immediately.
“The directive has been issued after the signing of the IGA this week,” revealed Mr Mnuna.
So far, Tanzania has completed the Environmental and Social Impact Assessment (ESIA) for the project, among other prerequisites.
Referring to the financial gains that Tanzania will get from the pipeline project, Mr Mnuna said the country would earn $1 billion a year (about Sh2.3 trillion) as income tax for the next 25 years.
The revenues will be generated on the start of the pipeline operations, whereby Tanzania will earn 60 percent of the paid tax - with Uganda pocketing 40 percent.
“There will be other financial gains that we will get from the project - apart from tax,” Mr Mnuna revealed.
He also disclosed that the Tanzanian authorities had granted the oil companies a VAT exemption on imported construction equipment like heavy machineries in order to facilitate construction of the pipeline which will have the capacity to transport 216Kbd: that is some 216,000 barrels of oil per day.
He added that contracted Ugandan shippers will pay $12.77 per barrel to EACOP Company for transporting crude oil from the production site to international markets.
As it stands in terms of the share-holding structure for the oil project, the up-streamers include Total Oil (66.7 percent after acquiring Tullow’s 33.3 share) and the China National Offshore Oil Corporation (CNOOC), with 33.3 percent shares. However, the Uganda National Oil Company (UNOC) will soon join the upstream stakeholders, holding 15 percent, Total oil stated.
During the construction phase, the 1,445km-long pipeline will create employment in the form of thousands of jobs throughout the pipeline’s route - and will unlock East Africa’s potential as it will result to over 60 percent increase in Foreign Direct Investments (FDIs) in Uganda and Tanzania.
During his recent visit to Chato in Tanzania, Uganda President Museveni said the project is set to exploit 6.5 billion barrels of oil. This is only 40 percent of the estimated deposits that has been discovered in the Albertine oil zone.
He further revealed that there had been lengthy debate and negotiations between Uganda and other stakeholders on the amount of tax and other expenses - processes which delayed commencement of the project for years.
For his part, President Magufuli revealed that the oil pipeline project will create more than 15,000 jobs for Tanzanians. Also he expressed optimism that the project’s implementation will open up the region for further trading opportunities - which would, in turn, fast-track socioeconomic development in the region.
The oil pipeline will start in the Buseruka sub-county, Hoima District, to Tanga. Tanzania hosts 1,115km of the pipeline (80 percent) with the remaining 330km being in Uganda.
What the crude oil pipeline means to Tanzania
MY TAKE
Gas revenues to heat the waxy crude oil from Uganda not factored in!
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #68
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #69
Pipeline deal: Oil firms set date for final investment decision
TUESDAY SEPTEMBER 15 2020
President Museveni (with hat) and his Tanzania counterpart John Pombe Magufuli sign the agreement on the oil pipeline in Chato District, Tanzania, on Sunday. PHOTO | PPU
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By FREDERIC MUSISI
More by this Author
The government and oil companies - French Total E&P, and China’s Cnooc - are eyeing December or January as the new dates for taking the final investment decision (FID) for development of the oil fields and the proposed East African Crude Oil Pipeline (EACOP).
Early investments in development of the oil fields—Tilenga in Buliisa and Nwoya districts operated by Total E&P, and Kingfisher in Hoima and Kikuube districts operated by Cnooc—and the 1,445km EACOP running from Hoima to Chongoleani terminal in Tanga at the Indian Ocean, is tagged to a capital expenditure of $10b (about Shs36 trillion).
The renewed optimism follows the signing of the host government agreement (HGA) for EACOP last Friday between government and Total E&P. The ceremony was witnessed by President Museveni and Total global chief executive Patrick Pouyanne.
Also signed on Friday were addendums to the earlier production sharing agreements [re]assigning operatorship of the oil fields—Tilenga to Total E&P, and Kingfisher to Cnooc, respectively, following Tullow Oil’s pending exit.
Also signed was a deed enabling the Uganda National Oil Company (UNOC)’s 15 per cent stake in both the Tilenga and Kingfisher projects. UNOC is the statutory body mandated to handle the country’s commercial interests in oil sector.
The HGA, which details some 54 clauses, is the cornerstone of the multi-billion-dollar project. It details, among other issues, governmental rights and obligations, investor duties, environmental and other relevant standards, liability, legal framework, arbitration, and closure of the project.
Negotiation of the HGA between Uganda and Total E&P, and Tanzania commenced in August 2017 and took longer than expected, consequently eating into the earlier stated timelines to the FID.
Matters were further complicated by the collapse of Anglo-Irish Tullow Oil PLC’s sales agreement last year in August and subsequently Total E&P, the lead project developer, froze all activities relating to EACOP until a deal was reached and announced back in April of Total E&P buying out the former.
But then there were several sticking clauses in the HGA, including which laws would be applicable governing the contract—but a compromise was reached to use the laws of England: the transit tariff of $12.2 (about Shs44,492) adjusted for inflation. The other issues were decommissioning of the project for which it was agreed to establish a decommissioning/escrow account for which all parties would deposit and be signatory to instead of Uganda and Tanzania alone, and insurance for the project.
Following Friday’s signing, Mr Museveni on Sunday flew to Tanzania where he signed a joint communique of endorsement of the principles of the HGA with his Tanzanian counterpart John Magufuli.
About the agreements
There are two HGAs for Uganda and Tanzania, which were negotiated in parallel, and require harmonisation. Following Uganda’s signing of its HGA it is expected that Total E&P and Tanzania will now fast-track negotiations of their HGA, which is expected to be concluded by mid-next month, other factors remaining constant.
The permanent secretary in the ministry of Energy, Mr Robert Kasande, told this newspaper yesterday that following resumption of negotiations “in earnest” leading to signing of the HGA, “we remain committed to our timelines for reaching FID.” The clearing of the HGA now paves way for commencement of negotiations on two key agreements for commercialisation of EACOP, the shareholders agreement that details the sharing holding structure, and the transportation agreement between Uganda as a supplier of crude oil and the proposed pipeline company that will sell the oil to the international market.
Currently, the tentative shareholding structure is; both Total E&P and Cnooc each taking a 37.5 per cent stake, Uganda through the National Pipeline Company, a subsidiary of UNOC, taking 15 per cent, and Tanzania through its national oil company, Tanzania Petroleum Development Corporation (TPDC), taking a 5 per cent stake. Insiders say Tanzania promised to up its stake to 25 per cent but is yet to commit further.
The capital expenditure for the project is $3.55b (Shs13 trillion), 70 per cent of which will be raised from international lenders. Each of the party has financial transactional advisers—Standard Chartered Bank for Uganda and Tanzania, Japan’s Sumitomo Mitsui Banking Corporation Europe Ltd and Standard Bank for Total E&P, and Industrial and Commercial Bank of China Limited (ICBC) for Cnooc—on board.
UNOC is expected to receive the first tranche of funding to finance its equity stake in the next financial year.
UNOC’s legal and corporate affairs manager Peter Muliisa said yesterday that conclusion of the HGA “significantly reduces work on the remaining key contracts,” leading to FID within the stated timelines.
How pipeline will be shared
Eighty per cent of the pipeline, 1,147km, will be on the Tanzanian side, and it is estimated that 80 per cent of the project capital expenditure will be spent in Tanzania. The Ugandan section of the pipeline is about 296km through 10 districts, affecting at least 4,121 persons.
Mr Kasande said following resumption of activities on the project, the relevant authorities will likewise resume the resettlement action processes on the proposed right of way.
The HGA is the second EACOP agreement to be signed following the Inter-Government Agreement (IGA) that binds the governments of Uganda and Tanzania on the project, which was signed in May 2017.
In keeping up with the spirit of fast-tracking the FID, Total E&P, the lead developer on the project, has already out sourced engineering, procurement and construction for the project.
Project construction is expected to start mid-next year and take 36 months, leading to creation of more than 10,000 jobs. The pipeline represents the largest trade deal ever between Tanzania and Uganda, currently comprising $120m (Shs425b) annually in each direction.
The big question is whether the timelines can be met. For Uganda, the coming months until next February will packed with politics and given the high political stakes, sometimes the financiers prefer to watch events from an arm’s length.
Project expenditure
The capital expenditure for the project is $3.55b (Shs13 trillion), 70 per cent of which will be raised from international lenders. Each of the party has financial transactional advisers—Standard Chartered Bank for Uganda and Tanzania, Japan’s Sumitomo Mitsui Banking Corporation Europe Ltd and Standard Bank for Total E&P, and Industrial and Commercial Bank of China Limited (ICBC) for Cnooc—on board.
Pipeline deal: Oil firms set date for final investment decision
TUESDAY SEPTEMBER 15 2020
President Museveni (with hat) and his Tanzania counterpart John Pombe Magufuli sign the agreement on the oil pipeline in Chato District, Tanzania, on Sunday. PHOTO | PPU
ADVERTISEMENT
By FREDERIC MUSISI
More by this Author
The government and oil companies - French Total E&P, and China’s Cnooc - are eyeing December or January as the new dates for taking the final investment decision (FID) for development of the oil fields and the proposed East African Crude Oil Pipeline (EACOP).
Early investments in development of the oil fields—Tilenga in Buliisa and Nwoya districts operated by Total E&P, and Kingfisher in Hoima and Kikuube districts operated by Cnooc—and the 1,445km EACOP running from Hoima to Chongoleani terminal in Tanga at the Indian Ocean, is tagged to a capital expenditure of $10b (about Shs36 trillion).
The renewed optimism follows the signing of the host government agreement (HGA) for EACOP last Friday between government and Total E&P. The ceremony was witnessed by President Museveni and Total global chief executive Patrick Pouyanne.
Also signed on Friday were addendums to the earlier production sharing agreements [re]assigning operatorship of the oil fields—Tilenga to Total E&P, and Kingfisher to Cnooc, respectively, following Tullow Oil’s pending exit.
Also signed was a deed enabling the Uganda National Oil Company (UNOC)’s 15 per cent stake in both the Tilenga and Kingfisher projects. UNOC is the statutory body mandated to handle the country’s commercial interests in oil sector.
The HGA, which details some 54 clauses, is the cornerstone of the multi-billion-dollar project. It details, among other issues, governmental rights and obligations, investor duties, environmental and other relevant standards, liability, legal framework, arbitration, and closure of the project.
Negotiation of the HGA between Uganda and Total E&P, and Tanzania commenced in August 2017 and took longer than expected, consequently eating into the earlier stated timelines to the FID.
Matters were further complicated by the collapse of Anglo-Irish Tullow Oil PLC’s sales agreement last year in August and subsequently Total E&P, the lead project developer, froze all activities relating to EACOP until a deal was reached and announced back in April of Total E&P buying out the former.
But then there were several sticking clauses in the HGA, including which laws would be applicable governing the contract—but a compromise was reached to use the laws of England: the transit tariff of $12.2 (about Shs44,492) adjusted for inflation. The other issues were decommissioning of the project for which it was agreed to establish a decommissioning/escrow account for which all parties would deposit and be signatory to instead of Uganda and Tanzania alone, and insurance for the project.
Following Friday’s signing, Mr Museveni on Sunday flew to Tanzania where he signed a joint communique of endorsement of the principles of the HGA with his Tanzanian counterpart John Magufuli.
About the agreements
There are two HGAs for Uganda and Tanzania, which were negotiated in parallel, and require harmonisation. Following Uganda’s signing of its HGA it is expected that Total E&P and Tanzania will now fast-track negotiations of their HGA, which is expected to be concluded by mid-next month, other factors remaining constant.
The permanent secretary in the ministry of Energy, Mr Robert Kasande, told this newspaper yesterday that following resumption of negotiations “in earnest” leading to signing of the HGA, “we remain committed to our timelines for reaching FID.” The clearing of the HGA now paves way for commencement of negotiations on two key agreements for commercialisation of EACOP, the shareholders agreement that details the sharing holding structure, and the transportation agreement between Uganda as a supplier of crude oil and the proposed pipeline company that will sell the oil to the international market.
Currently, the tentative shareholding structure is; both Total E&P and Cnooc each taking a 37.5 per cent stake, Uganda through the National Pipeline Company, a subsidiary of UNOC, taking 15 per cent, and Tanzania through its national oil company, Tanzania Petroleum Development Corporation (TPDC), taking a 5 per cent stake. Insiders say Tanzania promised to up its stake to 25 per cent but is yet to commit further.
The capital expenditure for the project is $3.55b (Shs13 trillion), 70 per cent of which will be raised from international lenders. Each of the party has financial transactional advisers—Standard Chartered Bank for Uganda and Tanzania, Japan’s Sumitomo Mitsui Banking Corporation Europe Ltd and Standard Bank for Total E&P, and Industrial and Commercial Bank of China Limited (ICBC) for Cnooc—on board.
UNOC is expected to receive the first tranche of funding to finance its equity stake in the next financial year.
UNOC’s legal and corporate affairs manager Peter Muliisa said yesterday that conclusion of the HGA “significantly reduces work on the remaining key contracts,” leading to FID within the stated timelines.
How pipeline will be shared
Eighty per cent of the pipeline, 1,147km, will be on the Tanzanian side, and it is estimated that 80 per cent of the project capital expenditure will be spent in Tanzania. The Ugandan section of the pipeline is about 296km through 10 districts, affecting at least 4,121 persons.
Mr Kasande said following resumption of activities on the project, the relevant authorities will likewise resume the resettlement action processes on the proposed right of way.
The HGA is the second EACOP agreement to be signed following the Inter-Government Agreement (IGA) that binds the governments of Uganda and Tanzania on the project, which was signed in May 2017.
In keeping up with the spirit of fast-tracking the FID, Total E&P, the lead developer on the project, has already out sourced engineering, procurement and construction for the project.
Project construction is expected to start mid-next year and take 36 months, leading to creation of more than 10,000 jobs. The pipeline represents the largest trade deal ever between Tanzania and Uganda, currently comprising $120m (Shs425b) annually in each direction.
The big question is whether the timelines can be met. For Uganda, the coming months until next February will packed with politics and given the high political stakes, sometimes the financiers prefer to watch events from an arm’s length.
Project expenditure
The capital expenditure for the project is $3.55b (Shs13 trillion), 70 per cent of which will be raised from international lenders. Each of the party has financial transactional advisers—Standard Chartered Bank for Uganda and Tanzania, Japan’s Sumitomo Mitsui Banking Corporation Europe Ltd and Standard Bank for Total E&P, and Industrial and Commercial Bank of China Limited (ICBC) for Cnooc—on board.
Pipeline deal: Oil firms set date for final investment decision
TRACE
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Huyo jamaa anayejiita MK254 sijui yuko na hali gani sasa hivi? Kwani walibana wakaachia kuhusiana na suala la upimaji wa CORONA etu wakatupatia masharti,tukawaambia wafuate masharti ya Mother Country "The King of East Africa" = Tanzania. Na hii ya sasa ndio atakuwa hoi bin taabani.Viva Tanzania
Geza Ulole
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Geza Ulole
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Ntaghacha
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BLOW
Uganda's exit from pipeline project slows Kenya's oil export hopes
Presidents Yoweri Museveni and John Magufuli meet in Chato, Tanzania on Sunday
In Summary
The two countries had in 2015 agreed to jointly build the oil pipeline
Investors in the Turkana oil project are pegging their investment decision on the completion of the pipeline
by VICTOR AMADALA
Business Writer
Kenya
20 September 2020 - 01:00
In image provided by Serengeti Watch showing the three possible route of the oil pipeline. The shortest route passes through the endangered Serengeti Park.
In image provided by Serengeti Watch showing the three possible route of the oil pipeline. The shortest route passes through the endangered Serengeti Park.
Kenya will now have to bear the full cost of the delayed Lokichar-Lamu crude oil pipeline after Uganda, which ditched the project in 2016 opted for the Tanzania route.
The move by Uganda further jeopardise Kenya's hope both for the oil pipeline, blurring the country’s dream for oil cash.
Last weekend, Uganda President Yoweri Museveni and his Tanzanian counterpart John Magufuli officially signed a $3.5 billion (Sh378 billion) deal that will see the Kampala route export its oil through Tanzania’s 1,445-kilometre crude oil pipeline.
Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania's Tanga port.
It added that the Kenyan route would delay the project, as it lacked roads and was always affected by monsoon winds for up to three months annually.
Kenya and Uganda had in August 2015 agreed to jointly build a 1,500-km (930-mile) pipeline to pump oil from Uganda to the Indian Ocean
The line was to cut through northern Kenya and the Lokichar Basin from Hoima in western Uganda before reaching the port city of Lamu.
An alternative route had the pipeline snaking through Kenya’s capital of Nairobi and on to Mombasa, a plan that Uganda said would be cheaper, but would have required displacing hundreds of residents.
Last year, Kenya was presented with two designs for the Lokichar-Lamu crude oil pipeline (LLCOP) with a price variation of $122.2 million (Sh12.9 billion)
This after British firm Wood Group completed the front-end engineering design (FEED) that shows Kenya can opt for a pipeline with onshore storage facilities that would cost $1.2 billion to construct or one with floating storage facilities at a cost of $1.1 billion.
Both the FEED and the environmental and social impact assessment (ESIA) studies were to ensure the project does not encounter environmental-related obstacles from environmentalists.
Even so, Kenya’s National Environment Management Authority (NEMA) has been holding on environmental and social impact assessment approval, delaying commercial production of crude oil in the Lake Turkana Basin.
Investors the Turkana oil project by Tullow Oil is tying the final investment decision on the construction of a Sh121.45 billion pipeline between the Lokichar onshore fields and Lamu, which is now set to be completed in the second half of 2023 and not June 2022.
In December last year, Nema welcomed public opinion on the proposed pipeline in Turkana, Samburu, Isiolo, Meru, Garissa and Lamu counties.
Last month, Canadian-based Africa Oil Corporation (AOC) said it was short of funds to complete ground activities at its South Lokichar Basin, Turkana County, further complicating Kenya’s chance to taste oil money.
In February reports indicated that Tullow and Total were looking for ways to sell down their stakes in the Kenyan project as part of the restructuring plan.
The British oil firm is frustrated by FID on Kenya, which has been postponed severally due to stalled issuance of an environmental impact assessment license.
The company had previously aimed to give the final go-ahead by the end of 2019 for its onshore Kenyan oilfields, which are expected to produce up to 100,000 barrels per day.
It had expected to start production of oil by 2022, which was pegged on getting investment commitments from each partner this year.
The official exit by Uganda from the oil pipeline project is likely to dent investors ' decisions in the Turkana oil project, dimming Kenya's hope for oil cash
Uganda's exit from pipeline project slows Kenya's oil export hopes
Uganda's exit from pipeline project slows Kenya's oil export hopes
Presidents Yoweri Museveni and John Magufuli meet in Chato, Tanzania on Sunday
In Summary
The two countries had in 2015 agreed to jointly build the oil pipeline
Investors in the Turkana oil project are pegging their investment decision on the completion of the pipeline
by VICTOR AMADALA
Business Writer
Kenya
20 September 2020 - 01:00
In image provided by Serengeti Watch showing the three possible route of the oil pipeline. The shortest route passes through the endangered Serengeti Park.
In image provided by Serengeti Watch showing the three possible route of the oil pipeline. The shortest route passes through the endangered Serengeti Park.
Kenya will now have to bear the full cost of the delayed Lokichar-Lamu crude oil pipeline after Uganda, which ditched the project in 2016 opted for the Tanzania route.
The move by Uganda further jeopardise Kenya's hope both for the oil pipeline, blurring the country’s dream for oil cash.
Last weekend, Uganda President Yoweri Museveni and his Tanzanian counterpart John Magufuli officially signed a $3.5 billion (Sh378 billion) deal that will see the Kampala route export its oil through Tanzania’s 1,445-kilometre crude oil pipeline.
Uganda said it dropped Kenya after it realised it would be cheaper using Tanzania's Tanga port.
It added that the Kenyan route would delay the project, as it lacked roads and was always affected by monsoon winds for up to three months annually.
Kenya and Uganda had in August 2015 agreed to jointly build a 1,500-km (930-mile) pipeline to pump oil from Uganda to the Indian Ocean
The line was to cut through northern Kenya and the Lokichar Basin from Hoima in western Uganda before reaching the port city of Lamu.
An alternative route had the pipeline snaking through Kenya’s capital of Nairobi and on to Mombasa, a plan that Uganda said would be cheaper, but would have required displacing hundreds of residents.
Last year, Kenya was presented with two designs for the Lokichar-Lamu crude oil pipeline (LLCOP) with a price variation of $122.2 million (Sh12.9 billion)
This after British firm Wood Group completed the front-end engineering design (FEED) that shows Kenya can opt for a pipeline with onshore storage facilities that would cost $1.2 billion to construct or one with floating storage facilities at a cost of $1.1 billion.
Both the FEED and the environmental and social impact assessment (ESIA) studies were to ensure the project does not encounter environmental-related obstacles from environmentalists.
Even so, Kenya’s National Environment Management Authority (NEMA) has been holding on environmental and social impact assessment approval, delaying commercial production of crude oil in the Lake Turkana Basin.
Investors the Turkana oil project by Tullow Oil is tying the final investment decision on the construction of a Sh121.45 billion pipeline between the Lokichar onshore fields and Lamu, which is now set to be completed in the second half of 2023 and not June 2022.
In December last year, Nema welcomed public opinion on the proposed pipeline in Turkana, Samburu, Isiolo, Meru, Garissa and Lamu counties.
Last month, Canadian-based Africa Oil Corporation (AOC) said it was short of funds to complete ground activities at its South Lokichar Basin, Turkana County, further complicating Kenya’s chance to taste oil money.
In February reports indicated that Tullow and Total were looking for ways to sell down their stakes in the Kenyan project as part of the restructuring plan.
The British oil firm is frustrated by FID on Kenya, which has been postponed severally due to stalled issuance of an environmental impact assessment license.
The company had previously aimed to give the final go-ahead by the end of 2019 for its onshore Kenyan oilfields, which are expected to produce up to 100,000 barrels per day.
It had expected to start production of oil by 2022, which was pegged on getting investment commitments from each partner this year.
The official exit by Uganda from the oil pipeline project is likely to dent investors ' decisions in the Turkana oil project, dimming Kenya's hope for oil cash
Uganda's exit from pipeline project slows Kenya's oil export hopes
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
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- #75
TPDC refloating pipeline tenders
ippmedia.com/en/news/tpdc-refloating-pipeline-tenders
September 23, 2020
23Sep 2020
By Guardian Reporter
Dodoma
News
The Guardian
TPDC refloating pipeline tenders
TENDERS for the East African Crude Oil Pipeline (EACOP) construction project are back to the drawing board.
This compels the process to start afreshinn the wake of flagging off the project after the Tanzania and Uganda governments signed a pact to build the 1,443 kilometre heated crude oil pipeline from the northern Uganda Hoima oilfields to the port of Tanga.
Several companies had already won tenders and were in various stages of finalizing their procurement processes, he stated.
“Now, following the project’s suspension things changed, and then came the Covid-19 pandemic, where earlier costs also changed. So what we shall now do is to re-advertise the tender bidding process,” he said.
The EACOP project was suspended in November last year after the lead developer, French oil giant Total E&P, stopped works and laid off staff after a tax dispute with the host government.
Firms that had won tenders earlier will be asked to amend various items as some costs have gone up and others gone down, he stated.
There is a pending agreement to be signed by the pipeline investing parties, and smaller agreements on the construction work to be completed by the end of the year, he elaborated.
“When all these agreements are in place, the decision to invest in the project will be given and TPDC will start looking for funds to initiate the construction process as shareholders, owning a stake in ECOP on behalf of the government,” he specified.
“We have talked about the project’s many benefits and these are in three areas – benefits from pipeline construction work such as jobs, land procurement, and our firms will get work to transport pipes. All in all we expect to employ 10,000 people,” the director noted.
There will be benefits from operations whereby 10,000 will be employed who will in turn create opportunities for another 70,000 people as well as revenues for the government, he said.
Construction work is expected to begin next year, taking three years to complete, while at the moment compensation of land for people where the pipeline will pass is now being worked upon, he further stated.
Last week, President John Magufuli and his Uganda counterpart Yoweri Museveni witnessed the signing of the agreement for the project’s implementation.
The two leaders inked a joint declaration that directed implementation of the 1,445km pipeline project whereby in Tanzania the pipeline traverses eight regions with 280 villages.
When completed, the pipeline will have the capacity to transport 216,000 barrels of crude oil per day and in the next 25 years, Tanzania will earn 7.5tr/-, project documents affirm.
September 23, 2020
23Sep 2020
By Guardian Reporter
Dodoma
News
The Guardian
TPDC refloating pipeline tenders
TENDERS for the East African Crude Oil Pipeline (EACOP) construction project are back to the drawing board.
Prof James Mataragio, the director general of the Tanzania Petroleum Development Corporation (TPDC) said here on Monday that logistical obstacles emerged after the project was suspended last year.
This compels the process to start afreshinn the wake of flagging off the project after the Tanzania and Uganda governments signed a pact to build the 1,443 kilometre heated crude oil pipeline from the northern Uganda Hoima oilfields to the port of Tanga.
Several companies had already won tenders and were in various stages of finalizing their procurement processes, he stated.
“Now, following the project’s suspension things changed, and then came the Covid-19 pandemic, where earlier costs also changed. So what we shall now do is to re-advertise the tender bidding process,” he said.
The EACOP project was suspended in November last year after the lead developer, French oil giant Total E&P, stopped works and laid off staff after a tax dispute with the host government.
Firms that had won tenders earlier will be asked to amend various items as some costs have gone up and others gone down, he stated.
There is a pending agreement to be signed by the pipeline investing parties, and smaller agreements on the construction work to be completed by the end of the year, he elaborated.
“When all these agreements are in place, the decision to invest in the project will be given and TPDC will start looking for funds to initiate the construction process as shareholders, owning a stake in ECOP on behalf of the government,” he specified.
“We have talked about the project’s many benefits and these are in three areas – benefits from pipeline construction work such as jobs, land procurement, and our firms will get work to transport pipes. All in all we expect to employ 10,000 people,” the director noted.
There will be benefits from operations whereby 10,000 will be employed who will in turn create opportunities for another 70,000 people as well as revenues for the government, he said.
Construction work is expected to begin next year, taking three years to complete, while at the moment compensation of land for people where the pipeline will pass is now being worked upon, he further stated.
Last week, President John Magufuli and his Uganda counterpart Yoweri Museveni witnessed the signing of the agreement for the project’s implementation.
The two leaders inked a joint declaration that directed implementation of the 1,445km pipeline project whereby in Tanzania the pipeline traverses eight regions with 280 villages.
When completed, the pipeline will have the capacity to transport 216,000 barrels of crude oil per day and in the next 25 years, Tanzania will earn 7.5tr/-, project documents affirm.
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #76
Geza Ulole
JF-Expert Member
- Oct 31, 2009
- 65,136
- 91,917
- Thread starter
- #77
Uganda’s Oil Ready to Hit the Market, Says Museveni
“Dr Pombe Magufuli and I agreed to commence negotiations of all pending oil agreements with immediate effect and to expedite the implementation of the East African crude oil pipeline project. So we can confidently say that we are ready for the commercialization of Uganda's oil,” Museveni said.
by
MAX PATRICO
posted onSEPTEMBER 29, 2020
President Yoweri Museveni has said that Uganda is now ready to commercialize oil production despite the delays. Museveni was speaking during the virtual 6th Oil and gas Convention in Kampala.
“Dr Pombe Magufuli and I agreed to commence negotiations of all pending oil agreements with immediate effect and to expedite the implementation of the East African crude oil pipeline project. So we can confidently say that we are ready for the commercialization of Uganda's oil,” Museveni said.
He added that the government of Uganda is not only committed to delivering first oil, but it is also only committed that the resources are used sufficiently. “I know there are some countries in Africa which discovered the Oil later than us but quickly went into production, but for us, we preferred to go slow and understand the industry. And now we understand it and have big capacity,” Museveni said adding that government now has laws in place to govern the downstream, upstream and midstream.
Museveni said that government has granted the Albertine Graben Refinery Consortium an additional 17 months to complete the environmental and social impact assessment and the front engineering design for the project. The oil pipeline will run from Buseruka sub-county in Hoima and run for 1445kms to the Tanzanian port of Tanga and when completed, it will be the World's longest heated oil pipeline.
On the other hand, Pierre Jessua General Manager, Total E&P Uganda said Total is implementing capacity-building programs to equip the locals in the oil and gas sector.
“There is a lot of work, but there is nothing that can stop it. We have some hard work to do, but we have proved to be very efficient in moving things forward in recent months,” he said.
Uganda’s Oil Ready to Hit the Market, Says Museveni | The Kampala Post
Ntaghacha
JF-Expert Member
- Jul 28, 2020
- 1,412
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Oil pipeline tenders launched – Pouyanne
The independent October 5, 2020 Business, In The Magazine, NEWS ANALYSIS, The News Today Leave a comment
Patrick Pouyanne poses for a photo with President Museveni after signing the host government agreement for the EACOP project on Sept1.1. COURTESY PHOTO
Total Chairman and Chief Executive Officer says ‘Africa is to remain at the Heart of Total’s Strategy’
Kampala, Uganda | THE INDEPENDENT | The Chairman and Chief Executive Officer of Total, Patrick Pouyanné, has said “Africa is to remain at the Heart of Total’s Strategy.”
He was speaking ahead of Total’s Sep. 30 strategy update at which he outlined the company’s long-term energy transition plans.
Pouyanne said Africa will be at the “heart” of the company’s long-term energy transition plans. But he also spoke of plans by the French major to sell some of its African interests as it focuses on its most profitable assets.
“Our ambition is to be recognised as a major, broad energy company in Africa with the largest oil and gas production, the biggest retail network and the ability to supply electricity from renewable sources,” Pouyanne told the recent Africa E&P summit hosted by Frontier Energy.
Mgid
CHICAGO REAL ESTATE
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Earlier, in an interview titled `Climate : a conversation with Patrick Pouyanné’ on the Total website on Sept.25, Pouyanné, explained that he believes Total’s main responsibility is to help provide safe, affordable energy solutions to as many people as possible, while managing energy consumption and the related emissions.
“The next 20 years will be decisive in building a low-carbon future that does not curb economic and social development,” he said, “That includes two billion people in Africa alone, where over 600 million people today do not have access to electricity. That figure worldwide is 1.2 billion.”
Pouyanné was responding to a question about what Total’s objectives for 2035 are.
He added: “I am also convinced that being `the most African international oil company’ is another one of our strengths. Africa, where these challenges are crucial, will lead the way in energy innovation. We intend to be the responsible energy major that meets these challenges. We are, after all, “Committed to Better Energy.”
Total’s emphasis on Africa makes economic sense given that it has long been a rich source of cash flow for the company, according to analysts. In 2019, the continent generated around US$10bn of Total’s US$26bn cash flow from operations, and 30% of its oil and gas production (900,000 barrels of oil equivalent per day).
The wider region, including North Africa, accounted for roughly 30% of the group’s US$19bn of global spending last year.
And although Total slashed its 2020 investment budget by 22% to less than US$15bn following the Covid-led price drop, the profits it makes in Africa will continue to help it fund its low-carboninvestments.
These green investments will equate to almost 15% of capital spending this year. Total has expanded its footprint across the resource-rich continent consistently over the years. More recently it has targeted East Africa and Southern Africa. Earlier last month, it signed agreements with Uganda’s government that it says will pave the way to a longawaited final investment decision on the Lake Albert oil project.
Total is also set to double its interest to 66% in Lake Albert and the associated pipeline to the Tanzanian coast after pouncing on struggling Tullow Oil’s assets in April. Pouyanne said tenders for the pipeline have been launched and “we expect to award contracts before yearend.”
The Lake Albert project should produce around 230,000 barrels of oil per day. Total, on behalf of the partnership company; the East Africa Crude Oil Pipeline (EACOP co.), is responsible for providing project information including tenders.
Tenders for the East Africa Crude Oil Pipeline (EACOP) project have been anticipated since Uganda in July gave Total the go-ahead to take-over the stake of the Irish exploration company, Tullow, in various oil blocks in the Albertine region. All suspended project tenders were expected to be re-launched by this time.
The next milestone is the issuance of the project Final Investment Decisions (FID) by partners by December.
Total’s Primary Focus
But Total’s primary focus will be Mozambique, where the company operates the US$20 bn, 13.1 million tonne per year Mozambique LNG project now in progress in Area 1.
There, where the estimated resources amount to some 60 trillion cubic feet of natural gas, start-up is set for 2024. However, the project could face potential delays due to an insurgency in the northeastern Cabo Delgado region where the onshore facilities are being built.
Meanwhile, the Train 7 expansion at Nigeria LNG is
Oil pipeline tenders launched – Pouyanne
The independent October 5, 2020 Business, In The Magazine, NEWS ANALYSIS, The News Today Leave a comment
Patrick Pouyanne poses for a photo with President Museveni after signing the host government agreement for the EACOP project on Sept1.1. COURTESY PHOTO
Total Chairman and Chief Executive Officer says ‘Africa is to remain at the Heart of Total’s Strategy’
Kampala, Uganda | THE INDEPENDENT | The Chairman and Chief Executive Officer of Total, Patrick Pouyanné, has said “Africa is to remain at the Heart of Total’s Strategy.”
He was speaking ahead of Total’s Sep. 30 strategy update at which he outlined the company’s long-term energy transition plans.
Pouyanne said Africa will be at the “heart” of the company’s long-term energy transition plans. But he also spoke of plans by the French major to sell some of its African interests as it focuses on its most profitable assets.
“Our ambition is to be recognised as a major, broad energy company in Africa with the largest oil and gas production, the biggest retail network and the ability to supply electricity from renewable sources,” Pouyanne told the recent Africa E&P summit hosted by Frontier Energy.
Mgid
CHICAGO REAL ESTATE
Real Estate Prices In Chicago Might Be Cheaper Than You Think
LEARN MORE→
Earlier, in an interview titled `Climate : a conversation with Patrick Pouyanné’ on the Total website on Sept.25, Pouyanné, explained that he believes Total’s main responsibility is to help provide safe, affordable energy solutions to as many people as possible, while managing energy consumption and the related emissions.
“The next 20 years will be decisive in building a low-carbon future that does not curb economic and social development,” he said, “That includes two billion people in Africa alone, where over 600 million people today do not have access to electricity. That figure worldwide is 1.2 billion.”
Pouyanné was responding to a question about what Total’s objectives for 2035 are.
He added: “I am also convinced that being `the most African international oil company’ is another one of our strengths. Africa, where these challenges are crucial, will lead the way in energy innovation. We intend to be the responsible energy major that meets these challenges. We are, after all, “Committed to Better Energy.”
Total’s emphasis on Africa makes economic sense given that it has long been a rich source of cash flow for the company, according to analysts. In 2019, the continent generated around US$10bn of Total’s US$26bn cash flow from operations, and 30% of its oil and gas production (900,000 barrels of oil equivalent per day).
The wider region, including North Africa, accounted for roughly 30% of the group’s US$19bn of global spending last year.
And although Total slashed its 2020 investment budget by 22% to less than US$15bn following the Covid-led price drop, the profits it makes in Africa will continue to help it fund its low-carboninvestments.
These green investments will equate to almost 15% of capital spending this year. Total has expanded its footprint across the resource-rich continent consistently over the years. More recently it has targeted East Africa and Southern Africa. Earlier last month, it signed agreements with Uganda’s government that it says will pave the way to a longawaited final investment decision on the Lake Albert oil project.
Total is also set to double its interest to 66% in Lake Albert and the associated pipeline to the Tanzanian coast after pouncing on struggling Tullow Oil’s assets in April. Pouyanne said tenders for the pipeline have been launched and “we expect to award contracts before yearend.”
The Lake Albert project should produce around 230,000 barrels of oil per day. Total, on behalf of the partnership company; the East Africa Crude Oil Pipeline (EACOP co.), is responsible for providing project information including tenders.
Tenders for the East Africa Crude Oil Pipeline (EACOP) project have been anticipated since Uganda in July gave Total the go-ahead to take-over the stake of the Irish exploration company, Tullow, in various oil blocks in the Albertine region. All suspended project tenders were expected to be re-launched by this time.
The next milestone is the issuance of the project Final Investment Decisions (FID) by partners by December.
Total’s Primary Focus
But Total’s primary focus will be Mozambique, where the company operates the US$20 bn, 13.1 million tonne per year Mozambique LNG project now in progress in Area 1.
There, where the estimated resources amount to some 60 trillion cubic feet of natural gas, start-up is set for 2024. However, the project could face potential delays due to an insurgency in the northeastern Cabo Delgado region where the onshore facilities are being built.
Meanwhile, the Train 7 expansion at Nigeria LNG is
Oil pipeline tenders launched – Pouyanne
eliakeem
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- May 29, 2009
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Ntaghacha
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Do it sir,if I can!