For Uganda and Tanzania to pull off the $3.5b East African Crude Oil Pipeline (EACOP) project, private sector players in the two countries must work closely, experts have said.

The two countries are moving to shore up investments in their nascent oil and gas sector, with early estimates projecting over 60% gain in Foreign Direct Investment from the pipeline project.

The two neighbours, who enjoy a long history of diplomatic and cultural ties, are also envisaged to draw investments worth over $20b from the sector over time.

At a media launch of the Tanzania-Uganda Oil and Gas Symposium in Dar es salaam on Thursday, November 4, experts reflected on the scale of opportunities from the joint oil and gas projects.

“These are exciting times for Tanzania and Uganda, and for the oil and gas industry. The signing of all agreements on April 11 heralded the beginning of a big bond between our two countries,” said Dr Elly Karuhanga, the chairman of the Private Sector Foundation of Uganda (PSFU).

Describing the 1,443km crude oil export pipeline as ‘an umbilical cord’ that joins the two countries, Karuhanga said the project would transform trade and bilateral relations.

Uganda is expected to start commercial oil production in 2025 while Tanzania expects to begin gas production in 2023. Tanzania could generate over $30b from natural gas alone over time.

While the two countries are expected to attract opportunities, the complexities of sourcing funds for the pipeline project call for deeper reflection on the role of the private sector.

“The private sector must live up to the ambitious targets of the countries’ leaders who have made difficult. If we do not live up to the standards, foreigners will be enlisted. 

As Ugandan and Tanzanian private sector players seek to cooperate on the flagship project, Karuhanga asked the firms from the two countries to be more cooperative and tolerant.

The burning questions about the involvement of the private sector will be explored at the symposium to be held in Dare Salam on November 25.

Uganda’s High Commissioner to Tanzania, Ambassador Richard Kabonero said the symposium would highlight how the private sector and local communities will play a big role in the project.

To be held under the theme: “enhancing private sector participation in the oil and gas sector,” the conference will draw over 200 officials from Tanzania and Uganda and over 2,000 virtually.

The private sector foundations of the two countries are behind the flagship oil and gas conference, with support from the respective foreign missions.

In Uganda, the pipeline will cover 296km across 10 districts and 25 sub-counties while the stretch in Tanzania covers 1,147km and traverses 8 regions and 25 districts.

Tanzania’s High Commissioner to Uganda, Ambassador Aziz Mlima encouraged the two private sector foundations to establish contact and form joint ventures to support the project.

“If we don’t do that, we may find ourselves without certain skills that are required, and then we import them from somewhere else,” he warned.