Rédaction Africa Links 24 with Uganda Monitor
Published on 2024-04-05 17:57:30
China has extended an invitation to Uganda’s Energy minister to visit Beijing for discussions regarding the country’s $5 billion crude oil pipeline, as announced by Uganda’s presidency. This development showcases a potential breakthrough in Uganda’s efforts to secure Chinese financiers to fund the pipeline necessary for the country to commence production from oilfields discovered in 2006.
The possibility of Chinese funding is seen as crucial, especially after Western banks declined to support the pipeline following pressure from environmentalists who raised concerns about the project’s impact on global carbon emissions. The involvement of Chinese financial institutions is now being considered as a promising alternative for funding the pipeline.
China’s Special Envoy for the Horn of Africa Affairs Xue Bing recently delivered a message from Chinese President Xi Jinping expressing support for the 1,445-kilometer pipeline. President Museveni’s office stated that Xi Jinping supports the project and Chinese financial institutions are open to discussions, inviting Energy Minister Ruth Nankabirwa to China for further dialogue.
The East African Crude Oil Pipeline (EACOP) is designed to transport oil from Uganda’s western oilfields to Tanga port on Tanzania’s Indian Ocean coast. President Xi Jinping emphasized in his letter the belief that the pipeline will contribute to socio-economic development in the region.
Previous discussions had been ongoing between Uganda and the Chinese export credit agency SINOSURE regarding potential funding for the project. However, multiple deadlines for reaching an agreement had passed without a resolution. Despite these challenges, the construction of the pipeline has commenced, with the transportation of pipes and materials to sites in Tanzania and Uganda. Additionally, a thermal insulation plant has begun operations to insulate the pipes before installation.
The progress made in discussions with China and the commencement of construction activities signify positive steps towards the realization of the EACOP project. The involvement of Chinese financiers could provide the necessary funding and support needed to advance the pipeline’s development and enhance Uganda’s oil production capabilities.
Overall, China’s interest and support for the EACOP project present an opportunity for Uganda to secure the financing required to bring the pipeline to fruition. The collaboration between the two countries could lead to significant advancements in Uganda’s oil industry and contribute to economic growth and development in the region. The ongoing discussions and construction activities demonstrate a commitment to moving forward with the project and leveraging Chinese support for its successful implementation.
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