In a move to bolster cooperation between both countries, Tanzania and Uganda have signed an agreement to construct a natural gas pipeline. This took place after a three-day Joint Permanent Commission Summit held in Kampala from August 21-23. The summit which was led by Tanzania’s Foreign Minister, Augustine Mahinga and Uganda’s Minister of Energy, Irene Muloni, was also attended by Uganda’s Ambassador to Tanzania, Richard Kabonero and officials from ministries of Defence, Energy, Trade and Agriculture, among others.
This gas pipeline is a first of its kind in East Africa. Since the extraction of natural gas commenced in 2004 at the Songosongo Island in Tanzania’s southern region of Lindi, no gas pipeline has crossed East African country borders. According to the Managing Director of Tanzania Petroleum Development Corporation (TPDC), Kapuulya Musomba, the pipeline will connect Dar es Salaam, Tanga port on the Indian Ocean, and Mwanza which is a port on Lake Victoria to Uganda.
Tanzania is endowed with estimated recoverable natural gas reserves of over 57 trillion cubic feet (tcf). This reserve which is mostly in offshore fields in the south of the country has been a source of attraction to a number of investors. The government is expecting to utilize this pipeline to pump its liquefied petroleum gas and make the export of the energy source easier. The success of this sector will contribute greatly to the country’s economic growth. The gas transmitted will also be used for power generation for industrial and domestic use.
The Ugandan government considers the steel and iron industry as the backbone of the country’s industrialization due to its projected contribution to the economy. Thus, the East African country also stands to benefit immensely from the agreement as the government looks to explore its 260 million-plus tonnes of iron ore deposit for its steel and iron industry. The reducing gas or elemental carbon used in the production of direct-reduced iron (DRI), also called sponge iron is produced from natural gas.
Once completed, the gas pipeline will solidify the robust bilateral relations between the two East African countries. It also has the potential to transform each country’s economic and financial status and make the region a choice destination to invest in especially for investors with interest in oil and gas exploration.
In May 2017, they both agreed to build a 1,445 km crude oil pipeline from Hoima in Uganda to Chongoleani in Tanga, Tanzania. The crude oil pipeline, according to the handlers of the project, French oil multinational company, Total, will become “the longest electrically heated crude oil pipeline in the world.”