The East African Crude Oil Pipeline is a buried pipeline
system that will transport crude oil produced from the Tilenga and Kingfisher
developments in Uganda’s Lake Albert area to world markets. The pipeline
starts in Kabaale – Hoima in Uganda and ends on the Chongoleani peninsula near
Tanga on the Indian Ocean coast in Tanzania. This major export system includes
1,443 km (296 km in Uganda and 1147km in Tanzania) of insulated and buried 24-inch
electrically heated pipeline, six pumping stations, two pressure reduction
stations, and a marine export terminal in Tanzania.
EACOP is also the name of the incorporated company established to build,
finance, and operate the pipeline. EACOPs shareholders are affiliates of the
Upstream Joint Venturers (TotalEnergies, CNOOC of China, and UNOC the Uganda
National Oil Company) together with the Tanzanian Petroleum Development
Corporation (TPDC).
Whilst EACOP will have custody of the oil during transportation, the ownership
of the oil will remain with the Government of Uganda and the Upstream Joint
Venture Partners who will also be responsible for oil sales onwards from the
EACOP redelivery point at the end of the Jetty in Tanga.
Following extensive studies of the different route options, in 2016 the
Government of Uganda selected the Kabaale (Hoima) – Tanga Route based on it
being the least overall cost and most technically robust route to deliver
Uganda’s oil to international markets.
The viscous and waxy nature of Uganda’s crude oil requires
maintaining the crude at a minimum temperature of 50°C for it to flow. To
maintain this operating temperature, the pipeline will be insulated – a little
bit like a thermos flask to keep the liquid inside warm and the outside cool.
If necessary, the pipe can also be electrically warmed under its
insulation. In Uganda this electricity will primarily be sourced from the
hydropower stations of the Ugandan National Grid. In Tanzania power will also
be sourced from the grid, together with EACOPs own power generation from a
mixture of Solar power, generators and battery storage.
No, the oil to be transported in the EACOP is in its Crude
form, with high Waxy Appearance Temperature (WAT) making it as a solid at room
temperature. The oil as such has no use directly but requires to be treated in
a Refinery. Uganda’s crude oil commercialization strategy is to promote a
refinery of 60,000 bbls/day that meets the petroleum products needs of Uganda
and its regional neighbors, with the remaining oil to be exported through Tanga
Port in Tanzania. A significant portion of the oil revenues, in the form of
royalties and profit sharing, will be returned to the Government of Uganda. In
August 2020 the Government of Uganda joined the Extractive Industries Transparency Initiative
(EITI).
Once constructed, no, the pipeline will not be visible as it
will be buried and topsoil and surface vegetation re-instated. Thus, it will be
much less visually impactful than other linear projects such as roads,
railways, or power lines. Whilst there will be some limitations on farming and
construction within the Right of Way, it will not be fenced, and people and
animals will be able to freely pass over it anywhere along its entire length.
The only parts of the pipeline infrastructure which will be visible will be the
pumping stations, the electrical heat tracing stations, the block valve
stations and the marine storage and offloading facilities.
After several years of surveys, technical studies, tendering
and finalisation of the legal and commercial framework, the Final Investment
Decision for both the two Upstream Projects (Tilenga and Kingfisher) and EACOP
was taken in February 2022. For EACOP, the focus from 2022 to 2024 has been on
land acquisition in both Uganda and Tanzania, appointment of the major
Suppliers and Contractors, Detailed Engineering & Procurement, early
technical surveys and civil works. The real construction on the ground commenced
in 2024 and will take about 2 years to complete. Once oil starts to flow, EACOP
will enter the operational phase expected to last about 20 years.
The estimated cost of construction is some $4 Billion.
It will be financed from equity provided by the shareholders and external
loans. Once in operation the pipeline will receive a tariff for each
barrel of oil transported to repay the loans and make a return on the
investment.
EACOP requires a 30m wide ‘Right-of-Way’ along the entire pipeline length to construct the pipeline, together with land for the ‘Above Ground Facilities’ such as the pumping stations and the Marine Terminal. EACOP has leased land under long term leases from the Authorities in Uganda and Tanzania. However, it is EACOP itself, in co-operation with the Authorities, that is responsible for the land acquisition process.
13,564 Project Affected Persons (PAPs) – broadly speaking; households but the definition also includes institutions and other entities) along the pipeline route have received compensation in cash and in kind directly from EACOP, in line with both National Legislation and the IFC Performance Standards.
The vast majority of these PAPs (96%) have some portion of their land impacted and have received compensation for the full replacement cost of their land, structures, crops and trees. Some 4% of the PAPs required their primary dwelling to be relocated and were offered replacement houses of a higher standard than their existing dwelling. In addition to cash compensation, the majority of PAPs were also entitled to in-kind compensation including transitional food support, financial literacy training and access to livelihood restoration programs.
In both countries EACOP has established a field-based team of Community Relations Coordinators and Community Liaison Officers together with an accessible grievance mechanism. This allows to maintain a constant dialogue between EACOP and the PAPs together with the surrounding communities. PAPs leave their affected land only after they have been paid their compensation (or in a few cases when the compensation is paid into escrow) and received their notice to vacate. This compensation process was started in 2021 and is now 99% achieved, and full land access is planned to be achieved in 2024. A grievance mechanism is in place and being used. Land Acquisition and Resettlement Status
EACOP has benefits for both Uganda and Tanzania which include job creation, local content, revenues for the host countries, infrastructure, logistics, technology transfer and enhancement of the corridor between Uganda and Tanzania. Local /National content is a key focus area both for the project and the host governments, including for the EACOP project participants and is integrated into the contracting strategy. In each country local/national content plans are in place to guide the implementation process.
The pipeline route does not go under Lake Victoria or cross
any IUCN categorised sites. The pipeline does not cross any chimpanzee
habitat, nor any areas with significant populations of large game. Some 8% of
the pipeline length traverses designated areas (covering a total area of 3.5
km2); the majority of these crossings are along the boundaries of such areas
that have already been largely modified by farming and other human activity.
The Project has carried out surveys to identify critical and
natural habitats. Where a species is identified, measures will be put in place
to minimise impacts during construction such as temporarily narrowing the right
of way or scheduling construction to occur at times when a species is not
utilizing the habitat.
In areas of Critical Habitat, the project has a clear commitment to use offsets to achieve a net-gain.
The design and construction of the pipeline will be carried
out in accordance with international standards including pressure testing with
water prior to introducing oil and installation of block valves to be able to
close and isolate sections of the pipe. Once in operation the pipe will be
continuously monitored using a fibre-optic cable along the entire pipeline
detecting temperature changes and vibration. Consequently, any intrusion,
attempt to expose the pipe or leak would be detected very quickly and with a
high degree of accuracy, allowing to isolate the section and respond. There is
no credible scenario of massive pollution of Lake Victoria.
Pipelines are safe and leakages are rare. However, as a responsible company, an oil spill contingency plan is part of the EACOP operating philosophy. It covers oil leakages on the pipeline, the above ground installations, and the export facilities. Thus, in the unlikely event of an emergency, we will be prepared and equipped to respond effectively. The monitoring and control systems will minimise the inventory of any release and allow to shut down the flow quickly. Regular drills with local emergency personnel, such as fire, police, and port authorities, will also ensure that response to an incident is well-coordinated and efficient. The viscous and waxy nature of the oil means that if there is a leak, the oil rapidly solidifies rather than dispersing into the environment. In case of contamination, actions will be carried out to remediate the land to its condition before the incident.
EACOP Project Community Liaison Officers or CLOs are a local
point of contact for all stakeholders and especially affected communities and
people. Community members can approach CLOs to raise their questions about the
Project and receive information and updates as the Project progresses. General
information about construction progress, grievances and EACOP led programs, is
available from the CLO’s offices in the regions where the pipeline will pass.