The Economic Commission for Africa indicates that East Africa registered the fastest economic growth in 2016 compared with the other regions on the continent, with an impressive growth rate of 5.5% in 2016, projected to increase to 6.0% in 2017 and 6.3% in 2018 respectively.

The World Bank’s Global Economic Prospects Report, further anticipates that Tanzania will post 7.1% growth, Kenya and Rwanda 6%, Uganda 5.6% and Burundi 2.5% in 2017.

Capital Injection in the Economy
East Africa’s development as a preferential business hub and the region’s remarkable investment flows are largely attributed to the capital investment in the oil, gas and manufacturing industries with the respective governments undertaking several multibillion dollar projects, such as, The East African Crude Oil Pipeline Project (EACOP). The EACOP is a 1,443km pipeline that will transport crude oil from Uganda to the Indian Ocean Coast in Tanzania. The construction of the pipeline will lead to  a substantial rise in Foreign Direct Investment (FDI) for both countries.

The 3.5 Billion USD investment capital associated with the construction and operation of the Pipeline will be directly injected into the economies of Uganda, and Tanzania increasing their FDI by over 60 % during the construction phase.

The project will be constructed and operated through a pipeline company with shareholding from the Uganda National Oil Company (UNOC), the Tanzanian Petroleum Development Corporation (TPDC), and the two oil companies, TOTALENERGIES and CNOOC.

Potential for oil exploration in the region
The East African Crude Oil Pipeline will unlock East Africa’s oil potential by attracting investors and companies to explore the potential in the region.

Enhancement of the central trade corridor
The project will contribute towards the enhancement of the central corridor between Uganda and Tanzania through the development of new infrastructure, logistics, technology transfer and the improvement of the livelihoods of East Africans.

Employment Creation
The pipeline will create short term (2-3 years) employment for both highly skilled and, semi-skilled professionals, and casual laborers. It is expected that casual workers who will be involved in the construction phase of the project will be sourced locally from each district, thus promoting the development of local capacity to develop other pipeline projects in the region.

Business Opportunities
The pipeline will also provide business opportunities for the different sectors of the economy  involved in the pipeline design, construction, and operation and decommissioning of the project, and create a trickle down economic effect spurring the development of local content.

 Developing the Oil & Gas Value Chain
The development and maintenance of the pipeline infrastructure in the two countries will also contribute to the capacity building and know-how of national service providers.

Targeted national content programs will aim to enhance the transfer of knowledge, training and capacity building to enable these companies to be pre-qualified and potentially bid for complex and high caliber projects.

Increasing Infrastructure Development
Along the pipeline route, service roads will be upgraded or developed to facilitate the access to and maintenance of the pipeline during its construction, operations and decommissioning phases. These roads will increase accessibility of the areas traversed by the pipeline enhancing the movement of goods and people and overall economic exchanges.

In 2006, commercial quantities of oil were confirmed to exist in the Lake Albert basin in Uganda. The Oil companies in Uganda; CNOOC LTD, TotalEnergies and TULLOW PLC completed the exploration phase. In November 2020 TotalEnergies finalized the acquisition of Tullow’s entire interests in Uganda Lake Albert development project including the East African Crude Oil Pipeline in 2020.  TotalEnergies, now a majority shareholder and CNOOC are now headed into development phase, which will consequently lead to the production of Uganda’s oil resources.

Once produced, the crude oil will be partly refined in Uganda to supply the local market and partly exported to the international market. The export to the international market will be through an export crude oil pipeline; The East Africa Crude Oil Export Pipeline (EACOP). This pipeline will be constructed and operated through a Pipeline Company with shareholding from the Uganda National Oil Company, the Tanzania Petroleum Development Corporation and the two oil companies; TotalEnergies and CNOOC.

THE EACOP PROJECT

The EACOP is a 1,443km crude oil export pipeline that will transport Uganda’s crude oil from Kabaale – Hoima in Uganda to the Chongoleani peninsula near Tanga port in Tanzania.

• The pipeline route was selected by the Government of Uganda as the least cost and most robust.
• Due to the viscous and waxy nature of Uganda’s crude oil, the pipeline will need to be heated along the entire route, making the EACOP the longest electrically heated pipeline in the world.
• The pipeline will be buried to minimize impact on the environment, with some facilities above the ground, designed to ensure minimal environmental and social impact.
• The project will be compliant with the Ugandan and Tanzanian national legislations and international requirements.
• The Marine Export Storage Terminal and the Load-Out Facility will be located north of Tanga port over the Chongoleani peninsula.