About 30 international and local campaign groups have asked two foreign banks to abandon plans to raise funds for the construction of an oil pipeline to export Ugandan oil, s move that has caused shock to government that so much wants the project kick off as early as possible. They argue that the project is likely to harm local livelihoods, water bodies and wildlife.
The 1,445 km pipeline, which will run from fields in Masindi district of western of Uganda to Tanzania’s Indian Ocean port of Tanga, is crucial to developing the country’s oil reserves.
South Africa’s Standard Bank Group and Japan’s Sumito Mitsui Banking Corporation are mobilising the funds needed to finance the US$3.5 billion pipeline.
“We consider this project to present unacceptable risks to local people through physical displacement and threats to incomes and livelihoods,” Global Witness and 29 other groups from Britain, the United States said in their letter to the two banks.
The groups said the project posed “unacceptable risks to water, biodiversity and natural habitats, as well as representing a new source of carbon emissions the planet can ill afford.”
The banks said they had received the letter and would talk to Ugandan government officials about the concerns raised by the activists.
Uganda’s oil reserves are estimated to be six billion barrels although progress on developing the oil blocs has been slow, partly due to disagreements between the government and oil firms about strategy. Uganda also took several years to decide on a pipeline route.
France’s Total, China’s CNOOC and Britain’s Tullow Oil control the Ugandan fields even though Tullow is finalising the processing of farming down.
The pipeline is expected to convey about 200,000 barrels per day (bpd) when oil production commences.
