Wednesday, April 6, 2016

Kenyan president Uhuru Kenyatta still in a great puzzle over oil pipeline project

Kenyan president Uhuru Kenyatta flew to France last week for a state visit “that could also give Kenya an opportunity to bring up the issue of the oil pipeline from Uganda,” Kenyan media reported. According to the reports, Kenyatta and his French hosts are scheduled to discuss counter-terrorism and radicalization issues, amongst other development and cooperation-related matters. However, considering the fact that Uganda had earlier indicated interest in passing the pipeline through Kenya before its recent U-turn by choosing a Tanzanian route, Kenyatta and his delegation are expected to engage in a lobbying mission in a bid to keep the project. French oil company Total is amongst three firms involved in the project. Others are Britain’s Tullow Oil and China’s CNOOC. The three players have not mutually agreed on the route, leaving leeway for lobbying both in East Africa and abroad. 

Kenyan president Uhuru Kenyatta 

The lucrative project has seen two East African Community member countries—Tanzania and Kenya—battle it out in recent weeks to win over Ugandan authorities. Tanzania is selling the operational Tanga port as the best route to pump Ugandan crude oil which is expected to flow to international markets in 2018 while Kenya is campaigning for its yet-to-be-built Lamu port. The Tanga route remains the most cost effective, according to Total E & P Uganda general manager Adewate Fayeni.  Fayeni said last week that as far as the company is concerned all the options have been evaluated carefully and the least cost remains the Tanga route. "As a company, our position remains that we are going through to Tanga route, I understand there are issues being discussed but our position remains the same," Fayemi told an East African Oil and Gas conference in Dar es Salaam. Tanzania has maintained that the agreement entered recently with Uganda for the construction of the pipeline was conclusive despite ongoing jostling by Kenya for the project. According to the presidency’s acting director of communications Gerson Msigwa, maneuvers by high-level officials in Kenya to try to snatch the project from Tanzania will eventually prove futile. “The Tanzania Petroleum Development Corporation and Ministry of Energy and Minerals are already carrying out tangible activities in relation to this project,” Msigwa said.

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