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Congo warms up to pipeline, railway projects on the Northern Corridor

The government of DR Congo is contemplating taking up a stake in the proposed crude oil export pipeline in western Uganda in strongest sign yet of warming ties between the two neighbouring countries.

Uganda’s oil fields with proven reserves of 6.5 billion barrels of crude oil lie near the border with DR Congo and some of the deposits are believed to lie across both countries.

Uganda’s Energy Minister Irene Muloni told The East-African discussions are ongoing about DR Congo piggybacking on a planned crude oil pipeline from western Uganda to Lamu on the Indian Ocean to export its own crude via the eastern route.

Total E&P, which is one of the three major players in the Uganda oil sector, also operates and holds a majority stake in Block III on the DR Congo side of the border whose potential is yet to be fully determined.

DRC’s minister for Energy and Petroleum Crispin Atama Tabe recently led a delegation to Kampala that discussed Congo’s potential investment in the pipeline.

Officials from the two countries also held talks on an inter-connected electricity grid between the two countries.

In the short run this would allow Uganda to export power to eastern DR Congo by the end of the decade when it is expected to have a generation surplus after the 178MW Isimba power dam and the 600MW Karuma dams are commissioned.

Uganda has already extended part of its national grid from Bwera, near the border, into eastern DR Congo.

“They came to say that we should develop the hydrocarbons in the area jointly and they said they want to join the proposed export pipeline and they also want to contribute to the refinery,” Peter Lokeris, Ugandan Junior Energy Minister said.

“It is a big development. To have joint export of resources you develop a strong neighbourhood and closer ties than ever before because of the common benefits that accrue from earnings and exports,” said Mr Lokeris.

The Congolese delegation made preliminary inquiries about participating in the wider infrastructure developments across the region, including the Standard Gauge Railway planned to run from Mombasa to Kigali with a spur to South Sudan.

Although the inquiries are understood to be at preliminary stages, an extension of the railway into mineral-rich eastern DR Congo could significantly improve the viability of the SGR project, especially the extension from Kampala to Kigali.

Keith Muhakanizi, the Permanent Secretary in the Finance Ministry in Kampala recently gave the green light to the Malaba-Kampala leg of the SGR but raised the red flag over plans to borrow as much as $8 billion before establishing the viability of the portion to run from the Ugandan capital to the border with Rwanda.

The Congolese officials were asked to formally write to Kenya’s President Uhuru Kenyatta, who currently holds the rotating chairmanship of the East African Community, to send a delegation of observers to the next infrastructure Summit on the Northern Corridor as a first step toward their possibility of co-investing in the project.

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