New oil pipeline to be built in Tanzania

A $3.5 billion framework agreement has been struck between Tanzania and Uganda for a pipeline construction to export oil internationally.

According to Tanzanian President, John Magufuli, the construction will take approximately three years to complete. “They can do it even at night to ensure that the project is completed as quickly as possible.”

Construction of the pipeline will start from Uganda, where the crude reserves are located and eventually run to its completion on the Tanzanian coast. Uganda expects 1.4 to 1.7 billion barrels to be used from their 6.5 billion overall crude reserves.

The agreement serves as a positive step for the economy. More than 10 000 jobs are expected to be created leading to the increase of foreign direct investment. Furthermore, it will also be recognised as the longest pipeline in the world with a length of 1445km. The presence of a built-in heater will facilitate oil circulation, decreasing its viscosity in order to keep the oil liquid enough.

Total and CNOOC (China National Offshore Oil Corporation) have joint ownership of Uganda’s oilfield and will be in charge for the duration of the construction. Total will own 54.9% of the project after they’ve invested a massive $900 million. The union between these two conglomerates paints a positive image for the project and future their relations.