Dar es Salaam. Tanzania stands to gain crucial lessons from the East African Crude Oil Pipeline (EACOP) project—particularly on how to enhance its legal and policy frameworks, improve institutional coordination, and maximise socio-economic benefits from large-scale investments.
This was the key message during a high-level breakfast meeting organised by the Policy Forum in collaboration with EACOP, held under the theme: EACOP: An international standards project fostering sustainability, development, and positive impacts.
Experts at the forum said that while EACOP promises long-term economic returns, it also reveals critical gaps in Tanzania’s governance systems that need urgent attention to ensure the country benefits fully from similar strategic ventures in the future.
Human Rights and Business Officer at the Legal and Human Rights Centre (LHRC), Mr Clay Mwaifani, said the EACOP experience calls for a broader understanding of local content beyond employment numbers.
“EACOP is technology-intensive and thus limited in job creation. At its peak, it employs around 6,000 people—just 0.008 percent of Tanzania’s population,” he said.
“Even Saudi Arabia, a global oil giant, employs less than one percent of its population in the petroleum sector. That’s the nature of the industry,” he said.
He urged policymakers to shift focus from employment alone to include capacity building, skills transfer, and long-term institutional development.
“Local readiness is key. Tanzania must prioritise knowledge transfer and strategic participation in both ownership and operations,” he added.
He said Tanzania will benefit from the pipeline through transit fees governed by the Oil and Gas Revenue Management Act, despite not being an oil-producing country.
The law requires that a portion of revenue per barrel transported be deposited in a special fund at the Bank of Tanzania (BoT) for future generations.
“But why restrict this approach to oil? I think the same principle should be applied to mineral revenues to benefit the country’s future generation,” said Mr Mwaifani.
Furthermore, Mr Mwaifani said EACOP should inspire Tanzania to adopt a more comprehensive and forward-looking model for natural resource governance.
On environmental risks, he warned that the high-tech nature of EACOP presents new challenges.
He said, unlike the ageing Tanzania–Zambia Crude Oil Pipeline (Tazama), which relies on gravity, EACOP is electrically heated and traverses ecologically sensitive zones, including over 500 kilometres within the Lake Victoria basin.
“One serious spill could affect millions. Do we have the capacity and preparedness to prevent or manage such disasters?” he posed.
Mr Mwaifani recommended an overhaul of Tanzania’s environmental laws to make Environmental and Social Impact Assessments (ESIAs) mandatory, moving beyond the traditional biophysical Environmental Impact Assessments (EIAs).
“EACOP has already conducted EIAs, Strategic Impact Assessments, and ESIAs. These should be the standard for all major projects,” he said.
Regarding ownership, he noted that the Tanzania Petroleum Development Corporation (TPDC) holds a 15 percent stake in EACOP, alongside Uganda National Oil Company (15 percent), China’s CNOOC (eight percent), and majority shareholder TotalEnergies (62 percent).
He underscored the significance of TPDC’s involvement, but highlighted concerns about whether it can lead such projects independently in the next two or three decades.
He challenged the mining sector to follow suit, noting that the State Mining Corporation (Stamico) has minimal direct involvement in major projects, with government shares held by the Treasury Registrar.
“Given the strategic value of critical minerals, Stamico should be embedded in key projects to build capacity and experience,” he said.
Mr Mwaifani also raised concerns over regulatory gaps in private security, noting that while private security firms play a growing role in extractives, Tanzania lacks a dedicated Private Security Act.
“EACOP incorporates voluntary principles on security and human rights. We need binding legislation to domesticate these standards and ensure consistency across sectors,” he said.
During the event, the Governance and Economic Policy Centre Executive Director, Mr Moses Kulaba, questioned the distribution and transparency of the $486 million earmarked for local content under EACOP.
“There must be clarity on who qualifies as ‘local’. Often, a handful of companies dominate procurement opportunities,” he said.
“In the mining sector, two firms once secured 70 percent of all procurement—mainly in fuel and heavy machinery,” he added.
Without robust oversight, he cautioned, EACOP’s local content pledges risk being reduced to mere statistics. Mr Kulaba also flagged the socio-economic impacts of mega-projects after construction ends.
“When construction phases out, many workers are left unemployed, which can lead to vandalism or unrest. Pipeline projects attract people during construction—some settle permanently. If the benefits are not well managed, it can fuel insecurity,” he cautioned.
Citing Nigeria’s Niger Delta, he urged long-term security planning along the pipeline corridor, which passes through sensitive areas in both Uganda and Tanzania.
Tabling her presentation, EACOP’s Local Content Manager for Tanzania, Ms Caroline Ngailo, told The Citizen that the project is anchored on three pillars: employment and training, procurement of goods and services, and capacity building through technology transfer. She revealed that by March 2025, Tanzanian firms had secured procurement contracts of goods and services worth $486 million—well above the local content target of $463 million.
“Close to 100 Tanzanian firms have benefited so far, particularly in catering, transportation, civil engineering, furniture supply, camp management, and fuel,” she said.
She cited Lake Oil and Simba Oil as the main fuel suppliers, in line with requirements to prioritise local firms.
“Several subcontractors are also participating across multiple procurement categories,” she added.
Ms Ngailo encouraged Tanzanians to regularly visit the EACOP website for updates on tenders and job opportunities. She noted that 143 trainees are currently being prepared for operational roles.
“We received 23,000 applications from eight regions and selected the best candidates for internal and external training,” she said.
EACOP’s General Manager for Tanzania and Director of Health, Safety and Environment (HSE), Ms Wendy Brown, said the pipeline project is being implemented with significantly higher levels of technical innovation compared to the Tazama pipeline, which was constructed over 50 years ago.
“The EACOP pipeline has multiple built-in systems designed to prevent oil from escaping. For instance, it is equipped with a fibre optic cable running along its entire length. This cable serves several purposes, including the detection of temperature, pressure, and fluid variations,” she said.
According to Ms Brown, the system can detect any intrusion or abnormal activity in real time, allowing for an immediate response.
“We are also in the process of developing a comprehensive oil spill contingency plan. This involves teams surveying the pipeline route, conducting environmental and risk modelling, and preparing emergency equipment and repair systems,” she said.
She added that it was crucial to recognise the significant differences between the products transported through the Tazama pipeline and those that will be moved via EACOP.
EACOP’s Resettlement Action Plan (RAP) Manager, Mr Abraham Youze, said the project affected a total of 9,927 individuals who lost land or other assets, including 344 people who were physically displaced.
“Spouses of Project Affected Persons (PAPs) were involved in the valuation process and gave consent before compensation agreements were signed,” he said. “Following the entitlement briefing, each PAP was granted a two-week reflection period.”
He added that approximately 9,594 joint bank accounts were opened to facilitate compensation payments, with all associated account fees waived for two years.
