Rwanda: Ugandan Oil Discovery Could Affect Pipeline Project James Karuhanga 13 January 2010
Kigali The long awaited oil pipeline from Kenya through Uganda to Rwanda may not be realized soon according to information availed to The New Times.
According to the minutes of a recent meeting between Rwanda and Libya of which The New Times has obtained, recent discovery of vast crude oil reserves in Uganda now threaten to delay or entirely put off plans for the construction of the pipeline.
According to the minutes, the observation was made by one member of the Libyan delegation which included representatives of Libya Oil Holdings as he gave an overview of their activities in Africa.
"Due to new unforeseen circumstances and the issue of the recent discovery of an economic quantity of crude oil in Uganda, the government of Uganda is planning to put up a new refinery that will serve the east African region which will lead to Kenya-Uganda pipeline project being not economically feasible," the delegate said.
A Libyan company, Tamoil Africa, has entered into discussions with both Kenya and Uganda in order to reach a "good optimum solution" on how to carry out the project.
According to media reports, the construction of the much needed oil pipe-line from Eldoret (Kenya) via Kampala (Uganda) to Kigali would cost stake holders up to Rwf 106 billion.
"However Kampala -Kigali pipeline will be affected to a great extent by the decision emanating from the aforesaid discussions since the signed Memorandum of Understanding prescribes that the Uganda-Rwanda pipeline will be an extension of Kenya-Uganda pipeline project.
It is stressed that because of this, Tamoil Africa Holdings' management "proposes to postpone the commencement of the feasibility study for this project until a decision and clarity on these issues is reached."
As a follow up of the meeting between the Prime Ministers of both countries late last year, top Rwandan and Libyan government officials held talks in Kigali on January 5 with the aim of reviving their bilateral cooperation as well as preparing for another bilateral meeting slated for May.
Top on the agenda of the meeting held at the Ministry of Foreign Affairs was the revival of the Joint Permanent Commission (JPC) framework.
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