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TZ finalises pipeline contracts

TZ finalises pipeline contracts

FIVE mini-contracts that would set off the construction of the East Africa Crude Oil Pipeline (EACOP) have been finalised and ready for signing, Tanzania Petroleum Development Corporation (TPDC) has confirmed.

Speaking to journalists in Dar es Salaam on Tuesday, TPDC Director General Dr James Mataragio listed the contracts as that of Land Lease Agreement for Priority Areas and Land Lease Agreement for Chongoleani Area.

Others are Marine User Right Agreement, Chongoleani Marine Facility Agreement and Land Lease Agreement for Pipeline Corridor.

“The negotiations of these five contracts have been finalised and approved by the two sides –the government of Tanzania and the investors meaning that they are “initialled”. Only what is pending now is the signing procedure,” Dr Mataragio said.

This latest announcement comes barely four days after the two Heads of State; Samia Suluhu Hassan and her Ugandan counterpart, Yoweri Museveni, witnessed the signing of the EACOP in Entebbe, Uganda last Sunday.

Uganda, Tanzania and the French oil company Total, along with its investment partner in Uganda, the China National Offshore Oil Corporation (CNOOC), signed a series of agreements to kick off the construction of the project, which is set to become the world’s longest pipeline for the heated crude oil. In the deal of $3.5 billion, the two countries signed the Host Government Agreement, Shareholder Agreement and Tariff Agreement.

President Samia said the event was ‘an auspicious occasion’ that would unlock the development of the region’s oil Continued from Page 1 resources, while Museveni hailed the deal as a major milestone and victory for the two countries. The shareholder agreements cover the construction of the pipeline, which is designed to connect oil fields near Lake Albert to the Tanzanian port of Tanga.

Dr Mataragio said through the milestone project, the government will increase revenue and create employments among other benefits. He explained that the crude oil pipeline project will create an enormous business opportunities to various companies, enterprises and individuals in addition to providing employment to many Tanzanians before, during and after the construction.

“Opportunities such as transportation and supply of equipment, security services, food supply, hotel accommodation, human resource management, office services, fuel supply, communication services, environmental skills and rental of building machinery will all be required throughout the project,” he pointed out.

Dr Mataragio also said that some 21bn/- is expected to be released as compensation to citizens whose pieces of land have been taken to pave way for the project. Mataragio said 1.678bn/- will be disbursed as compensation to 391 residents, whose pieces of land have been annexed and reserved as priority areas, including camps to be used during the project undertaking.

He said another 20.4579bn/- will be paid to at least 9,122 residents, whose land totaling 9,223.23 acres was taken to pave way for the pipeline corridor (pipeline wayleave).

On Monday, the government declared to start implementation of Uganda-Tanzania crude oil pipeline project from this month, a move to go hand in hand with an intensive awareness campaign to encourage people to grab opportunities during the implementation. Earlier, the implementation was planned to start in July this year.

“We have planned to start from Kyaka to Chongoleani in Tanga, where the pipeline will pass by going from region after region and district after district, we motivate citizens to grasp opportunities coming with the implementation of this project,” Energy Minister Medard Kalemani told the National Assembly in Dodoma.

However, the minister noted the mega project whose implementation would take three years to complete will pass through eight regions, 24 districts and 127 villages covering a big part in the Tanzania side.

During the implementation phase, the project is expected to create over 10,000 jobs for Tanzanians, with Dr Kalemani calling upon the locals to turn out for the opportunities. According to some official reports, the investment would be a major source of increasing direct foreign investment in both countries by 60 per cent.

Tanzania is expected to earn an estimated 3.24bn US dollars once the project becomes operational with more than 18,000 jobs set to be generated over the next 25 years. As part of long-term economic benefits, the EACOP project is expected to attract more investors exploring oil and gas resources in the countries.

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