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THIS SUBJECT PLEASE QUOTE NO: PR/004/10/15 PRESS STATEMENT

UGANDA AND TANZANIA SIGN CRUDE OIL EXPORT PIPELINE FRAMEWORK

KAMPALA 12/10/2015

The Governments of the Republic of Uganda and the United Republic of Tanzania yesterday

signed a Memorandum of Understanding to identify and assess the least cost crude oil export

pipeline to the East African Coast.

The agreement creates a working framework for the potential development of a crude export

pipeline project option from Hoima to Tanga Port of Tanzania. The objective is to select a route

that will result in the lowest unit transporation cost and sonstitutes the most viable option for the

pipeline project.

Dr Fred Kabagambe-Kaliisa, the Permanent Secretary of Uganda’s Ministry of Energy and

Mineral Development, said the deal enables the parties to continue working together to fine

tune studies and field work to further appraise the merit of a crude export pipeline option

through Tanzania with a view to achieving the lowest unit transportation cost for crude oil from

Uganda.

“If we can be able to get least cost pipeline to Tanga, then our crude oil will be exported

cheaply. We need to carryout due diligence. This requires real technical work to inform our

citizens about the end-user tariffs and the Memorandum of Understanding sets a stage for

carrying out detailed evaluation exercise,” he explained.

The deal follows an earlier Memorandum of Understanding (MoU) signed between the

Government of the Republic of Uganda and the International Oil Companies licensed in the

country for the commercialization of the newly discovered petroleum resources.

It was agreed that the crude oil discovered in Uganda is commercialized through crude to

power, refining; and export of crude oil to international market.

Dr Kabagambe-Kaliisa explained that Uganda has looked at various options of developing the

crude oil export pipeline that includes Hoima-Lacor-Lamu Port, Hoima-Nairobi-Mombasa Port;

and now Hoima-Northern Tanzania-Tanaga Port.

MINISTRY OF ENERGY AND

MINERAL DEVELOPMENT

P. O. BOX 7270,

THE REPUBLIC OF UGANDA

“As a country, we evaluating the routes with the idea that we have the least cost route because

we would like to ensure that our crude oil has value,” he said.

The MoU, he said, includes Total Exploration and Production Uganda and Tanzania Petroleum

Development Corporation (TPDC). In this regard, the Government of the Republic of Uganda,

the Government of the United Republic of Tanzania, the TPDC and Total E & P Uganda on the

Hoima-Northern Tanzania-Tanga pipeline development framework.

Adewale Fayemi, the General Manager Total E & P Uganda, thanked President Yoweri

Museveni of the Republic of Uganda and President Jakaya Kikwete the United Republic of

Tanzania for the impetus and facilitation of the process that has led to the signing of the deal.

“The MoU we have signed today is key milestone of achieving the least cost option to transport

Uganda’s crude oil to the Indian Ocean Coast, and we look forward to fine tune the process,”

he said. “We, at Total, we are committed to support the route as least cost option and we shall

collaborate with all the partners.”

James Mataragio, the Managing Director TPDC, said “this is a great project,” adding “If

executed, it will great opportunities for the people of Tanzania.”

“This project is going to open new investment opportunities, and create jobs. We have that

experience required to build and manage pipelines. I want to assure Ugandans that they have

got all the support from TPDC and Government of United Republic of Tanzania.”

Ngosi Mwihava, the Ag Permanent Secretary of Tanzania’s Ministry of Energy and Minerals,

said the crude oil export pipeline was the best mode of transportation especially considering the

resources Uganda has in place.

“This infrastructure will stand the test of time in our regional cooperation. The due diligence is

valid exercise because you have to justify the route you are going to consider to justify the least

cost option,” he said.

We will make sure that we come with good option for both Uganda and the East African region

because this is an opportunity to cement for regional integrations.”

For more information please contact: communications@energy.go.ug