A number of things are happening in Uganda. Almost on a daily basis there is a new trending topic; from the serious to the silly. In my view, there are two major events that we cannot afford to lose track of in the noise; the announcement by oil companies that they have taken FID (Final Investment Decision) and the accession by Democratic Republic of Congo (DRC) to the East African Community. These are seismic events that have the capacity to shape the future of Uganda.
Ernest Rubondo, the Executive Director of Uganda’s Petroleum Authority, has on several occasions compared the investment in Uganda’s Oil and Gas industry to the investments countries undertake in hosting either the football World Cup or the international Olympics. He argues that more money is being invested in Uganda’s Oil and Gas industry than Italy, Brazil, Russia and America invested in hosting the World Cup respectively. More money than Spain, Australia, Greece or Brazil spent when hosting the Olympics. It’s safe to say that the investment is, “for World Cup.”
This investment isn’t limited to the development of oil fields, it will fund the construction of a 1445km crude oil export pipeline from Hoima to Tanga which will be the longest heated crude oil export pipeline in the world. This pipeline will establish a new export route for Uganda to the sea. By the end of 2022, $ 3.5 bn will have been invested in setting up the infrastructure to build this industry.
As we build the Ugandan oil project, we must realise that this is actually an East African project. By virtue of its geographic location, Uganda’s oil is shared with Democratic Republic of Congo and there may be more oil across the border. The bulk of items that will be imported to bring this project to life will come through the port of Mombasa therefore without Kenya there is no project. The oil will go through the Port at Tanga. As a result, without Tanzania there is no project. Please note that this isn’t the only energy project in East Africa. Tanzania has discovered trillions of cubic feet of natural gas and awaits FID of $ 30 bn.
Historically, we have suffered from a lack of consistent supply of energy, making our people depend on firewood. Our energy poverty is the largest cause of environmental degradation in this part of the world. Developing the oil and gas resources can be good for our environment.
The East African Community now includes Congo. It is now the region that has the world’s largest collection of fresh water bodies. EAC has the great Nile River, the River Congo, River Kagera, Lake Victoria, Lake Tanganyika, Lake Kivu, Lake Albert to mention a few. The region has forest cover. This is now the place where, “The East African Savannah meets the West African Jungle.” It is also worth noting that we have a median age of 18, a huge population, governments that for the first time have prioritized the development of infrastructure across the region. So, the decision to develop our oil and the decision to expand East Africa to include DR Congo are seismic decisions.
Now, this enormous investment, this incredible opportunity, will it trickle down? Is it worth it? Critics argue that the development of the oil is the worst thing to happen to humanity and the accession of DRC to the EAC is a complete waste of time. If we develop our oil it is said all mankind will die. That the money will remain with a few elites. That the poor may become poorer. That our countries will fight before they unite. I cannot agree with those who see a calamity in every opportunity. They however do have a point. We must work hard to develop our oil and protect our environment. We must jealously guard and equitably distribute the resources we shall get. They may be right. We may fail. We may fall but what if we fly?
Never before have we been faced with such an opportunity. Yes, it comes with its challenges but which opportunity doesn’t?
Fear is valid but so is faith.
