Pipeline deal is done... How will locals benefit? Cop, leaders tell us
Thursday October 01 2020
When all the crude oil has been sent out the way mineral ores and agricultural produce always are, what will our descendants do with the 1,445km pipe whose cost of $3.5 billion will ultimately have been paid by us? ILLUSTRATION | JOHN NYAGAH | NMG
The EACOP — East African Crude Oil Pipeline — couldn’t have been more appropriately named. For it is set to be East Africa’s cop as far as the competence of those we pay to plan is concerned.
No wonder, even under the current pandemic limitations, Uganda’s President Yoweri Museveni found it inevitable to fly to Tanzania and meet with his counterpart John Pombe Magufuli, for the signing of the humongous $3.5billion “host government agreement” and the implementation agreement for the East African Cop.
This cop is going to monitor, examine and quietly judge our planners competence and our capacity as 100 million citizens of Tanzania and Uganda combined to select the right policymakers, and in Uganda we just raised the number of the of national legislators to some 550, come elections due in four months.
If you haven’t been hit by the enormity and significance of the East African Cop which President Magufuli hailed as the (second) biggest victory for Uganda and Tanzania that is only comparable to the one against Field Marshal Idi Amin in 1979.
The Cop signing came two days after the (French) Total chief executive officer and the Ugandan president signed the Final Investment Decision on Uganda’s oil fields. So all is set to go, over 15 years since we started celebrating the confirmation of commercial oil quantities in Uganda’s Albertine region in the west of the country. Then we were told that the 2005/06 national budget was to be last one that wouldn’t enjoy a hefty non-tax oil revenue content on the income side.
True, we have since got hundreds of millions of dollars from transfer taxes between oil explorers and oil exploiters. That is another long story that has passed through courtrooms in England and got even more complicated because spending of oil money was supposed to be sanctioned by parliament, something that was forgotten until the money had been spent and so on.
Anyway, the pipeline is going to be built to take crude oil from Ugandan fields to the sea as raw material for others to refine and use the products. Some still conveniently call them oil by-products though they are set to eventually be the main products as the tipping point for the automobile industry happened earlier this year when electric vehicles finally overtook fuel combustion ones as cheaper to acquire and maintain in developed. So gasoline is set to be the by-product eventually.
And if our uptake of EVs (Electric Vehicles) and AFVs (Alternative Fuel Vehicles) in East Africa remains slow while it grows in the developed states led by China and the US, then we might end up the main buyers of dirty fuel refined out there as a by-product. So we would be getting back to the pre-independence lamentations of colonial masters taking out raw materials cheaply and selling as finished products at crippling prices blah blah… Luckily for Africa’s Independence leaders, they are all dead and cannot die a second time of disappointment. Sh…don’t tell good ol’ Ken (Kaunda!)
And don’t get tempted to blame the owners of $3.5 billion pipeline, they are investors and have to pursue the most viable model for their business and acceptable to financiers, not your cherished refinery dream. And now with the pipeline a done deal, the feeble environmentalists voices already reassured, Uganda and Tanzania should plan for other real benefits from the 1,445km along pipeline, where it will pass.
About local content stories, we sincerely hope they go beyond selling food and unskilled labour, and digging trenches for local engineering firms. But how else the pipeline will be utilised depends on the brain power of Ugandan and Tanzanian planners.
They have hopefully already figured this out and will in good time let us in on the plans. For you can’t leave the fate of a 1,445km facility from the heart of the continent to the sea to every opportunist to play with, the way we let people mess up road reserves.
At least John Pombe Magufuli became famous in part for the uncompromising way he would preserve the integrity of road reserves in Tanzania before he became president.
How will the EACOP reserves be used? The way the railways and road reserves in Uganda have been stolen by both the plundering mighty and the scavenging weak? When all the crude oil has been sent out the way mineral ores and agricultural produce always are, what will our descendants do with the 1,445km pipe whose cost of $3.5 billion will ultimately have been paid by us?
These days mineral discoveries get announced in Uganda every other month. Do we have any plans for them in the context of the pipeline? We have stupendously plentiful amounts of confirmed iron ore which can quickly be smelt using modern zero-emission methods that have already been presented to the government.
What role will that (local content) steel play in the pipeline construction and after? It is not Total’s job to ask and answer those questions; it is our leaders to. The East African cop indeed is going to confirm some vital truths about us.