US $10bn Uganda oil project receives approval

TotalEnergies has issued a green light for the development of a US $10bn oil project that will require the construction of the world’s longest heated pipeline and make landlocked Uganda an oil producer for the first time.

The French energy major and its partners China National Offshore Oil Corporation (Cnooc) and the Uganda National Oil Company announced the final investment decision for the project at a ceremony in the Ugandan capital Kampala.

Oil was first discovered in Lake Albert on Uganda’s north-western border with the Democratic Republic of Congo in 2006. But successive problems, not least the challenge of how to build the 1,443-km electrically heated pipeline needed to export the crude via Tanzania, led to repeated delays and questions over whether the project would ever be realized.

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Sustainable development

Those doubts have continued even after Total strengthened its control of the project in 2020, as climate pressure mounts on energy majors to reduce or cease investment in new oil and gas projects.

Total has committed to cutting emissions but it has also shown it remains willing to fund new hydrocarbon investments. In September it announced an initial US $10bn investment in a series of projects in Iraq to boost oil production, reduce gas flaring and increase renewable power generation.

“The development of Lake Albert resources is a major project for Uganda and Tanzania, and our ambition is to make it an exemplary project in terms of shared prosperity and sustainable development,” chief executive Patrick Pouyanné said in a statement released following the ceremony.

Total said the project was in line with the company’s strategy of only approving new projects that were “low-cost and low commissions”.