AFRICANGLOBE – Uganda and Kenya have recharged plans for an oil pipeline aimed at transporting petroleum products between the two east African countries.
Analysts praised the move, saying it was going to be beneficial for both countries as they will be producing oil soon.
As for Uganda, hopes of the eventual redemption of its economy are pinned on the oil industry.
The country recently raised the amount of oil reserves discovered so far to 3.5 billion barrels but production is not expected until 2017.
And Kenya’s treasury has forecast real GDP will grow at 5.7 percent next year. The country’s growth in recent years has been accompanied by an expansion of infrastructure with roads and communication links expanding.
Additionally, the discovery of oil and minerals promises another step change in the years ahead.
Landlocked Uganda transports all its fuel – imported primarily through Kenya’s Mombasa seaport – in tankers over several hundred kilometres of road.
Government officials say the method is unreliable, costly and is damaging roads.
The new pipeline, estimated to cost $300 million, is expected to join an existing pipeline from Eldoret, western Kenya, and ferry oil to Uganda’s capital Kampala, a distance of about 352 kilometres.
Frank Tukwasibwe, Uganda’s commissioner for petroleum supplies, said the countries had asked firms interested in the contract to submit their bids.
“We expected all potential bidders to submit their papers by 30th January and by July or August we want a contractor on site,” he was quoted as saying.