Uganda's oil find stalls plan to extend Kenya's Libyan pipeline, a week before terror arrives

Where there is oil there is terrorism. The recent discovery of large deposits of crude in Uganda has thrown the construction of a major oil pipeline between Eldoret and Kampala into disarray forcing its financiers back to the drawing board.

Kenya and Uganda governments are crafting a fresh design for the key regional infrastructure that could see a reversal of the pipeline's direction of flow as well as enhance its capacity to pump crude rather than processed petroleum products.

Tamoil- the Libyan state-owned firm that was to construct the pipeline - said in a brief in May that unforeseen circumstances and the recent discovery of economic quantities of crude in Uganda had made the project unviable.

Kenyan officials admitted that the discovery of oil in Uganda had thrown the Eldoret -- Kampala pipeline plan off the track, but added that fresh options are being considered.
"The project is on course, but there has been an urgent need for a redesign that requires re-tendering for the new specifications," said Patrick Nyoike, Kenya's Energy permanent secretary.
Mr Nyoike said the new design, if approved by the Cabinet, will pave the way for an investment decision.
A fresh design of the 400 kilometre pipeline and re-tendering for the project will see Kenya and Uganda governments spend more than 15 years on the planning phase of the pipeline seen to hold the key to energy security and future growth in East Africa.

It is also expected to more than quadruple the project cost to $350 million (Sh28 billion).
Mr Nyoike said the pipeline's capacity has been reduced to 12 inches from the 14 inches initially provided for in the original design that was first mooted in 1995 under a joint partnership between Kenya and Uganda governments and Tamoil East Africa, a Libya state-owned company.
Tamoil was to construct the pipeline on behalf of the two governments under the build, operate and transfer (BOT) initiative.

Uganda has been on the horns of dilemma since British petroleum mining firm Tullow announced the discovery of large deposits of crude on the shores of Lake Albert two years ago.
Kenya's western neighbour and the largest export market for Kenya's petroleum products has yet to decide whether to export its oil in crude or refined form.

Kampala has not hidden its interest in adding value to the estimated two billion barrels of crude oil reserves at a local refinery in readiness for export, but Tullow Oil which has bought rights over the deposits from the Ugandan government is said to be keen on shipping out the oil in crude form.

Either option has grave implications for Kenya, which has been Uganda's main supplier of petroleum products and has been on the search for a business model that will serve its economic interest in the new dispensation.
"The discovery of oil in Uganda and decision to refine crude at home will change the direction of flow with significant impact on the Kenyan economy," said George Wachira, an industry consultant with Petroleum Focus.

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[magellanmax]

The pipeline idea is good for the environment and all that..... but anybody know how many people will lose their jobs?

[IranContraScumDid911]

@magellanmax Looks like Libya will not be doing the job ..... not sure about the jobs.

[Reqrezentin]

So IranContraScum what exactly do you think is behind the al-shabaab explosives?

[IranContraScumDid911]

@Reqrezentin Al Shazzam had nothing to do with attacking Uganda, it was not a suicide bombing. Uganda is several countries away from a Somali civil war. There are plenty of other good targets much closer to home. Uganda is in the middle of GIANT Oil deals to tap it's new reserves. The IMF has taken control of Uganda, and the global elite that stage terrorism for political purposes are moving in. Terror is part of the oil contract. Pakistan, Afghanistan, Iraq, Iran ... all oil rich terror bases

[TheEwooz]

i bet americans want to start a cold war with china over frican oil, as always africans will get fooled with american mascared about brinign freedom and security thru AFRICOM, when every one knows the us always coinsiders only its own interstest AFRICA cCAN BURN for all they care.

[TheEwooz]

africa the dark continent is americas next oil frontier

[TheEwooz]

where there is oil there bush family.