President Museveni’s speech at the launch of East African crude oil pipeline project

 

 SPEECH BY H.E. YOWERI KAGUTA MUSEVENIPRESIDENT OF THE REPUBLIC OF UGANDA AT THE LAUNCHING OF THE TILENGA AND EAST AFRICAN CRUDE OIL PIPELINE (EACOP) PROJECTS STATEHOUSE    -   ENTEBBE 11TH APRIL, 2021

1 The  President  of  the  United  Republic  of  Tanzania  and  your delegation; The  Chief  Executive  Officer,  Chairman  and  Delegation  from Total SE; The President and delegation from CNOOC; Cabinet Ministers; Ladies and gentlemen.

Your Excellency, Samia Hassan and your distinguished delegation. You are  most  welcome  to  your  brother  country  of  Uganda. Again,  condolences  on  account  of  the  death,  recently,  of  our  brother  H.E.  Magufuli.  Also  congratulations  on  your  inauguration  as  President  of  the  United  Republic  of  Tanzania.  Thank  you  for  responding to my invitation to join us and the Total Company  of  France  to  sign  the  Agreement  on  the  East African Pipeline from Hoima to Tanga.

2 Your   brother   country   of   Uganda, discovered petroleum and gas in 2006.  It has taken these 15 years before the first oil, on account of the divergent perceptions  between  us  and  the  oil  companies.    Initially, I did not favour the idea of the pipeline. My question  was:  “Why  export  the  oil.  Don’t  the  East  Africans need the oil?”  In this thinking, I preferred an Oil Refinery only, so that we use the extractable oil out of 6.5 billion barrels confirmed in only 20% of   the   potential   area   in   the   Mwitanzigye   and   Butuumbi valleys (known as the Albertine Grabben by  the  foreigners), to  satisfy  the  demand  for  the refined   products   for   Uganda,   North   Western   Tanzania,   Western   Kenya,   Rwanda,   Burundi,   Eastern  Congo,  South  Sudan  and  South  Western  Ethiopia, with  cheaper  products  on  account  of  the  lower transport costs.  

The demand in this zone is now 98,250barrels per day.  Uganda’s demand  is  currently  38,785 barrels per day. At the price of US$50 per barrel (equivalent to about US$63 per barrel of products), this locally refined  petroleum, would  knock  off  US$1.22billion from Uganda’s import expenditure for petrol, diesel, aviation  fuel  and  tar  for  roads. If  you  include  the  petroleum   bye-products,   such   as   plastics, the

3 saving   on   the   import   bill   would   add   another   US$400millions. Using the extractable portion of the 6.5billion  barrels  confirmed,  this  would  ensure  petroleum   self-sufficiency   for   the   Lake   Victoria   Basin Countries and those neighbouring them for a period of 38 years    based    on    the    present    consumption  levels. This  Oil  Refinery  would  be  owned  jointly  by  the  East  African  Governments, if they agreed to participate. The  oil  companies,  however,  were  biased  in  favour  of  exporting  crude  oil  only.  The  compromise,  then,  was:  “Ok,  let  us have  both  the  Refinery  and  the  Pipeline.” Most  of  this, was  when  the  Tanzanian  route was not in the picture. We were still debating about  Mombasa and  Lamu  of  Kenya. 

When  the  Tanzanian  route  of  Tanga  became  more  viable,  a  new consideration entered my mind ─the historical role of Tanzania in the liberation of Uganda in both 1978/79  and  1985/86.  On  these  two  occasions,  Mwalimu Nyerere played a very important role.  In the   1978/79,   TPDF   played   the   major   role   in   removing   Idi   Amin   from   power.   In   1985/86,   Mwalimu  Nyerere  gave  us  5000 rifles  at  the  right  time,  just  before  the  assault  on  Kampala,  starting  on the 17th of January, 1986.  

4 Kenya,  of  course,  is  a  brother  country,  just  like  Tanzania.  However, historically, there is this unique role of Tanzania.  I am, therefore, most satisfied, that the  project  will  make  a  modest  contribution  to  the  development of Tanzania. It cannot compensate for the  huge  sacrifice  Tanzania  made  for  the  defeat  of  Idi Amin and the liberation of the whole of Southern Africa  (Mozambique,  Zimbabwe,  Angola,  Namibia  and South Africa).  It is just a modest contribution. Moreover,  this  pipeline  project, can  be  a  core  of  bigger   developments   if   the   brothers   in   Congo-Kinshasa and South Sudan choose to also use it for their  oil. At  the  maximum,  it  can  carry  230,000 barrels  per  day.

Besides,  the  same  corridor, can take a return gas pipeline, supplying Tanzanian and Mozambiquan gas to Uganda and the Great Lakes’ region. I  salute  the  Government  of  Tanzania  for  the  tax  concessions they made to keep the tariff paid by the owners  of  the  oil  to  be  limited  to  US$12.77 per barrel. 

5 Recently,  we  also  made  concessions  regarding  the  land and port charges. This will, in effect, push the tariff to US$13.03 per barrel.  The Lamu route was proposing US$15.8 per barrel as  tariff.  All  this,  is  on  account  of  the  extractable  portion  of  the  6.5billion  barrels  confirmed  and  licenced for production as already pointed out.  This is,   however,   only   in   20%   of   the   Mwitanzigye-Butuumbi   basin   (known   to   foreigners   as   the   Albertine Grabben).

There  is  a  high  chance  for  more  oil  and  gas  to  be  found  in  the  remaining  80%  of  the  oil  province,  especially in the Mwitanzigye area (such as Kibiro, Butyaba,  etc).  Then,  there  is  a  totally  new  hydro-carbon zone in the North East of the country, in the Mount Kadam basin. There are oil sippages on the surface, there are source rocks, reservoir rocks and trap  rocks  (accumulation  rocks),  that  have  been  seen. 

If  the  brother  countries  work  together,  there  is,  then,  the  oil  in  Congo  and  South  Sudan.  This  pipeline  could  turn  out  to  be  a  very  important  project  that  may  serve  the  region,  not  only  in  the  short term but also in the medium, if not in the long-term.  

6 This  project  should,  in  addition  to  what  we  have  said,  serve  to  awaken  all  Africans  that  prosperity  and strategic security, are only possible if we use the Pan-Africanist  approach  that gives  us  a  bigger  market and rationalizes economic linkages.

I cannot end these brief remarks without thanking Her  Excellency  Samia  Hassan  for  indulging  my  sentimental   request   of   conducting   this   signing   ceremony on the 11th of April, 2021.  Forty two (42) years  ago,  this  same  day, is  when  the  Tanzanian  troops of 20 Division captured Kampala and enabled a  Ugandan  Army  officer,  Oyite  Ojok,  to  announce  the  fall  of  Idi  Amin  on  Radio  Uganda.  At  that  very  moment,  with  my  rapidly  growing  Fronasa  troops,  operating  with  another  TPDF  division,  the  Task  Force division under Major-General Silas Mayunga, I was on the Mbarara Front.  20 Division was under General Munguri. Today, therefore, is a triple victory for  Tanzania  and  Uganda:  military,  political  and  economic. Long live Tanzania Long live Uganda Long live President Hassan.

7 I  thank  Your  Excellency  and  your  delegation  for  coming for this function. I also salute the people of Tanzania for agreeing to host the project.

11th April, 2021 - Entebbe