Standard Bank Group says pipeline projects will benefit the region
A proposed natural gas pipeline running between Uganda and Tanzania could possibly limit deforestation for firewood, says a Standard Bank executive.
What you need to know:
- A proposed natural gas pipeline from Tanzania to Uganda may have a positive environmental impact, says a Standard Bank executive.
- People in the region rely on firewood and cut trees down for energy, but the gas pipeline could change that.
- The gas pipeline would run parallel to a controversial crude oil pipeline – and may similarly face resistance from environmentalists.
Dar es Salaam. Africa’s biggest lender by assets, Standard Bank Group has defended oil and gas pipeline projects between Tanzania and Uganda saying they will have significant benefits to the East African nations.
The two countries proposed a natural gas pipeline from Tanzania to Uganda, which would run parallel to the $4 billion East African Crude Oil Pipeline (EACOP) currently under construction.
The oil pipeline is opposed by environmentalists and the gas line may face similar resistance.
However, the Standard Bank Group’s regional chief executive officer for East Africa, Mr Patrick Mweheire told Bloomberg that the projects would have “huge benefits” for both nations.
The gas pipeline, in particular, would help curb deforestation, he said.
“One of the biggest issues in Uganda is that you know, 70 percent of cooking is still done by charcoal and firewood, so they’re cutting trees down,” said Mr Mweheire.
Also Read: EAC boss defends oil pipeline project disputed by Europe
Uganda intends to proceed with the EACOP, which will transport oil from the shores of Lake Albert on the border between Uganda and the Democratic Republic of the Congo to Tanga port in Tanzania.
However, the European Union has urged the governments to stop work on the pipeline on the grounds that it threatens fragile wildlife habitats.
Also Read : Tanzania, Uganda hit back at EU on Oil pipeline plan
International oil major TotalEnergies which is implementing the oil project will on October 10 answer to allegations of environmental and human rights abuse before the European Union parliament in Brussels.
The European parliament has summoned chief executive Patrick Pouyanné to Brussels to justify the project that the lawmakers denounced last week.
He will appear before the parliamentary Committee on Environment, Food and Natural Resources, as well as that of Human Rights.
Last week, the EU parliament passed a resolution calling for the French oil major and its joint venture partners to delay the projects by one year, to address environmental and human rights concerns.
That decision was dismissed by Ugandan President Yoweri Museveni who said the country will look for alternatives if TotalEnergies obeys the European Parliament.
The oil company, siding with President Museveni, has also vowed that the projects – now in the development phase – will not be halted.
Similarly, the Tanzanian government through the Ministry of Energy responded to the EU’s motion by reiterating the measures taken to ensure the EACOP adheres to international standards. “The EACOP and the government of Tanzania will ensure that the project is carried out in an exemplary manner in terms of transparency, shared prosperity, and sustainable development including the environment and respect to human right,” said energy minister January Makamba.
As TotalEnergies pondered how to navigate this crisis, President Museveni was on a warpath with the company, whose 62 percent stake makes it the biggest shareholder in EACOP. Uganda National Oil Corporation (UNOC) and Tanzania Petroleum Development Corporation (TPDC) own a 15 percent stake each, with China National Offshore Oil Corporation (CNOOC) owning eight percent shareholding.
While meeting ruling party MPs’ caucus on September 16, the president warned that should TotalEnergies cave in to pressure from the EU parliament and halt EACOP or pull out of the project agreement, he is ready to drag them to the international court of arbitration.
He later tweeted dismissing the EU parliament’s resolution but more significantly, he fired a warning shot at the French oil giant.
“We should remember that TotalEnergies convinced me about the pipeline idea; if they choose to listen to the EU parliament, we shall find someone else to work with,” read the tweet on September 16.
The EACOP Company last week uploaded on its portal the status of compensation of project affected persons (PAPS) – a key tenet on which the EU censure is partly based, as well as the environmental and social impact assessment.
With construction slated to start by end of this year, only 331 out of a total of 9,513 EACOP’s PAPs in Tanzania will be physically displaced and have been selected for replacement housing, the website says “construction of these houses is ongoing”.
In Uganda, out of 3,648 PAPs, only 203 will be physically displaced, and majority of these have elected for replacement housing. These too are under construction according to the website.
