Oil & Gas: Use Integrated Biodiversity Assessment Tool To Save Fragile Ecosystems

By Patrick Edema

The world’s governments, through the Convention on Biological Diversity (CBD), agreed on a set of 20 targets to help stop the loss, reduce the pressures on, and improve the state of global biodiversity.

These were known as the Aichi Biodiversity Targets (set in Aichi, Japan).

And in order to achieve them effectively, governments needed to implement action plans and strategies and this is where tools that show maps and spatial data, including the location of national parks, forests, and endangered species were developed to make governments planning for developments more sustainable without destroying the ecosystems.

One such tool that was developed for viewing and analyzing biodiversity information covered in the Integrated Biodiversity Assessment Tool (IBAT).

It is an innovative tool designed to facilitate access to a range of global and national data layers, such as protected area boundaries, biological information about habitat and species diversity indices, and key areas for biodiversity, which can be useful for research and conservation planning purposes.

The tool was a result of a groundbreaking conservation partnership among BirdLife International, Conservation International, and International Union for Conservation of Nature and UN Environment World Conservation Monitoring Centre and was made possible by a diverse set of data providers, users, and funders in governments, business and civil society from over 200 countries and territories.

With Uganda’s oil developments which are located in the Albertine grabben, one of the most bio-diverse regions in the African continent hosting 40% of Africa’s mammals, 50% of birds and about 20% of its amphibians and plants, the region also has more threatened and endemic species than any other region of Africa.

For instance, the 1443km EACOP project will negatively impact nearly 2,000 square kilometres of protected wildlife habitats. In Uganda, the pipeline will impact the Taala and Bugoma Forest Reserves, the latter home to large groups of Eastern Chimpanzees. Some 500 square kilometres of wildlife corridors for the Eastern Chimpanzee and African Elephant are likely to be severely degraded.

This underscores the relevance of oil companies and government to conserve the environment and protect critical ecosystem where the oil developments criss-cross through community land, national parks, water bodies, forest reserves, wetlands, and other different geographic zones.

Therefore, IBAT tool provides a basic risk screening on biodiversity through an interactive mapping tool that decision-makers are able to easily access and use this up-to-date information to identify biodiversity risks and opportunities within or close to a project boundary to protect sensitive ecosystem amidst oil activities in critical areas.

It also incorporates biodiversity considerations into key project planning and management decisions which include identifying potential investments, sitting an operation in a given area, developing action plans to manage for biodiversity risks and impacts, assessing risks associated which helps potential sourcing regions, and reporting on corporate biodiversity performance.

Some of the oil companies like Tullow manages the aspect of biodiversity within some regions. This company has developed a biodiversity management plan and uses Biodiversity Assessment Tool (IBAT) for accessing the information regarding the environment and biodiversity of the regions where it conducts its oil activities to ensure that the negative impacts on the environment are minimized by the application of Mitigation Hierarchy that meets the international standards on environment.

Therefore, the IBAT tool will help the government of Uganda in identifying critical biodiversity areas such as tourism sites like Murchison falls and Queen Elizabeth National Park, water resources wildlife species that will be threatened by the oil and gas projects, and ensure that they are protected from the related oil dangers.

 Patrick Edema, Environmental Engineer at AFIEGO

 

Will Uganda Meet Climate Change Obligations Amidst Oil Developments?

By Patrick Edema

The Parliament of Uganda passed the national climate change bill 2020 to implement the climate change response measures in line with resolutions from international conventions like the Paris Agreement, the Kyoto Protocol, and the UN Framework Convention on Climate Change.

The bill once assented into law is expected to provide for national participation in climate change mechanisms, provide for institutional arrangements for coordinating and implementing climate change measures, measuring of emissions, and financing for climate change actions, among others.

However, this has come at a time when the government of Uganda is in the final stages of oil and gas production and recently, on April 11, 2021, the governments of Uganda and Tanzania with the oil companies signed the East African Crude Oil Pipeline (EACOP) project agreements to pave way for the construction of a 1,443km crude oil pipeline from Uganda’s Albertine region to the Tanzanian seaport of Tanga.

For an understanding of the East Africa Crude Oil Pipeline (EACOP), the pipeline will transport a waxy variety of crude oil that solidifies at ambient temperatures, and therefore, it will be heated to at least 50 degrees Celsius throughout the entire length of the pipeline to arrive at a port for international export, vastly increasing the pollution, environmental and economic costs of exploiting Lake Albert area crude oil reserves. 

As stated by the ESIA, the EACOP pipeline is to transport 216000 barrels of crude oil per day at ‘plateau production’ so that the crude oil can be refined into transportation fuels that are used to power internal combustion engines and others.

The extraction of oil will take place at two oil fields which include the Kingfisher field being operated by China National Offshore Oil Corporation Ltd (CNOOC) and the Tilenga field, operated by Total S.A. It is estimated that the three oil projects are projected to generate over 102 million metric tons of greenhouse gas emissions per year.

For instance, the EACOP oil project is expected to produce 34.3million metric tons of CO2-equivalent (CO2e) per year, 45million metric tons of CO2e for the Tilenga oil project, and 32million metric tons of CO2e per year for the Kingfisher oil project.

With the bill's objective to give the force of law in Uganda to the United Nations Framework Convention on Climate Change, the Kyoto Protocol, and the Paris Agreement, which seeks to limit temperature rise to as close to 1.5 degrees Celsius as possible, this creates more suspicion that the climate change law may not achieve the country’s targets of reducing greenhouse gases by 22 percent by 2030.

Therefore, the government’s investment in the oil and gas sector at a time when an energy transition is ongoing and even the European oil and gas majors are reducing investment in the sector will also mean that Uganda will be stuck with infrastructure that provides less value than the investment made in the infrastructure.

Ugandans could also be forced to continue depending on oil and gas, which has grave negative impacts on the environment, climate change efforts, health and human rights.

Patrick Edema is an Environmental Engineer at AFIEGO

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A Green Food Sustainable Uganda Is At Risk Amidst Oil Production

By Brighton Aryampa

On 11th April/2021 at a ceremony in the Statehouse in Entebbe, Uganda, Tanzania, and Total S.A., the French oil major, signed three agreements to finalize the development of an oil pipeline from Uganda’s oil fields to Tanga on the Tanzanian coast, one of the last steps to the sanctioning of the country’s oil projects.

Many economists assert that the signing takes Uganda closer to a final investment decision or project sanctioning by the oil firms on its several projects. Mr. Pouyanné CEO Total said the oil firms are targeting oil production in 2025.

With the ongoing projects of Total’s Tilenga and CNOOC’s Kingfisher, the major concerns regarding climate worsen over the signing of three agreements for the East African Crude Oil Pipeline (EACOP) project.

And for that matter, green Uganda is at stake. Every Ugandan appreciates the role trees play in both the natural economy and in ecology maintenance. Trees provide products such as wood and others.

Forests also play roles such as rainfall formation, soil fertility maintenance, carbon capture, and others. Nature-dependent communities and economies such as Uganda need forests to survive.

However, oil roads and the Tilenga, Kingfisher, as well as EACOP oil projects, directly and indirectly, affect the conservation of forests and forest landscapes such as Budongo, Bugoma, Taala, Wambabya, Murchison Falls National Park (MFNP), and others. 

The oil projects cross-river bodies too.

The unfortunate part is that adequate information on the value of forests and forest landscapes including the value of below-ground flora and fauna isn’t provided in the Environmental and Social Impact Assessment (ESIA) reports enabling a clear understanding of the full value of forest resources that stand to be destroyed.

When sustainably used, forestry resources are renewable and can serve generations of Ugandans. However, oil and gas resources are exhaustible, necessitating the conservation of our forest resources that will serve Ugandans for generations.

Forests on climate

To remind those doing everything possible, forests play a critical role in the Earth’s climate system, in a number of different ways. Most importantly for global climate change, they capture carbon dioxide from the atmosphere and convert it, through photosynthesis, into living biomass: tree trunks, roots, branches, and leaves.

Forests also store carbon in forest soils, absorbed through leaf litter, woody debris, and roots; whether these inputs are sequestered in the soil matrix or biodegraded and returned to the atmosphere as carbon dioxide, and if so at what rate, depends on complex interactions involving soil minerals, plants and soil organisms, and organic components, all influenced by factors such as local climatic conditions and forest management.

The stake is too high. Not only climate is being threatened but also our heritage of Small-scale agriculture which is the backbone of Uganda’s economy providing the largest number of jobs and ensuring food and nutritional security is at stake.

Uganda’s oil activities are taking place in major lakes and rivers. Under the Tilenga project, an oil pipeline is planned to be constructed under River Nile to transport oil from the oil fields to Hoima. Two-thirds of the EACOP will also be constructed in the Lake Victoria basin.

Rivers such as Kafu and wetlands across the ten EACOP-affected districts in Uganda are going to be affected by the EACOP. There are no assurances that fisherfolk, who contribute 3% to Uganda’s GDP and 12% to the agricultural GDP, will be protected amidst Uganda’s wild oil exploitation plans.

This is more so the case as plans such as the oil spill management plan for the Tilenga, Kingfisher, and EACOP oil projects among other critical mitigation plans aren’t in place yet. With the threats to agriculture and fisheries, food security in Uganda is at risk.

Uganda was able to remain self-sustaining during the COVID-19 pandemic as small-scale farmers, livestock keepers and fisherfolk fed the nation. However, with the increased landlessness, climate change, and other risks posed by Uganda’s oil dreams, this sustenance is at risk

One of Uganda’s flagship economic activities is at risk because of Uganda’s oil dreams. Major national parks such as MFNP, Kabwoya Game Reserve, and others have become the playground for oil activities.

Even Queen Elizabeth National Park (QENP) could become a plaything for oil companies as the government put Ngaji oil block, which is found in the park and Lake Edward, up for bidding in May 2019.

Tourism contributes nearly 10% to Uganda’s GDP and is responsible for 23% of Uganda’s exports as well as earnings of as much as $1.6 billion. The tourism and travel sector also employs 667,000 people in Uganda.

These earnings and jobs have been put at risk as oil drilling, increased vehicular traffic, opening up MFNP and other eco-sensitive areas to poachers through road construction and others have put and will continue to put biodiversity at risk.

 We the people of Uganda do not hate development but it’s time to be committed to supporting Uganda and Tanzania to be leaders of the 21st-century transition to clean renewable energy while promoting green economic activities.

Let us borrow Experiences from countries such as Nigeria and know that oil spills are almost unavoidable and as seen especially in African oil-producing countries. We appeal to our Ugandan government not to allow oil pipelines to be built in catchments for lakes and rivers, forests despite this precedent knowledge.

We further appeal to the government to take precautionary measures and establish scientific certainty before we destroy our natural biodiversity that serves present and future generations as an exhaustible resource.

Let’s not live a life of fantasy and illusions that oil will solve all our problems because it will not, Nigeria, Libya, Ecuador among so many oil-producing countries have many problems. Proper utilization of the available resources if properly and transparently done can take us where we want to go as a country as we protect our economy, heritage, culture, and identity.

I urge the government of Uganda through ministry of energy and mineral development to treat the oil dreams with the seriousness they deserve because it is scientifically a mistake. Some dreams kill.

The writer is a lawyer and director, Youth for Green Communities (@YGCUganda).

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Don’t Sacrifice Fragile Ecosystems For Oil Developments

By Patrick Edema

The governments of Uganda and Tanzania with the oil companies signed the East African Crude Oil Pipeline project agreements to pave way for the construction of a 1,443km crude oil pipeline from Uganda’s Albertine region to the Tanzanian seaport of Tanga.

The extraction will take place at two oil fields which include the Kingfisher field being operated by China National Offshore Oil Corporation Ltd (CNOOC) and the Tilenga field, operated by Total S.A.

It is noted that about 80 percent of the project capital expenditure will be spent in Tanzania. The Ugandan section of the pipeline is about 296km and will affect 10 districts and 25 sub-counties, and 172 villages respectively.

This project presents unacceptable risks to local people through physical displacement and threats to incomes and livelihoods, water sources, biodiversity and natural habitats in addition to representing a new source of carbon emissions.

The EACOP project is estimated to generate over 34.3 million metric tons of carbon gases per year at a time when the world’s scientists are telling us that new fossil fuel developments need to stop if we are to tackle the climate crisis. According to a report from the Carbon Tracker Initiative, several of Total and CNOOC’s projects in Uganda are incompatible with the Paris Agreement.

The expected crude oil to be transported by the EACOP will be extracted in Albertine Graben which will most directly impact the Murchison Falls National Park, posing a serious threat to biodiversity and rare and endangered species.

Moreover, important tributaries of the Nile flow nearby. Nearly 2,000 square kilometres of protected wildlife habitats will be negatively impacted by the EACOP project. This will be caused by the feeder pipeline that from Tilenga oil field situated within Murchison Falls National Park.

Another feeder pipeline will encroach on the vulnerable Bugoma Forest Reserve, home to large groups of Eastern chimpanzees. From Hoima, EACOP subsequently runs through the Taala Forest Reserve. The potential loss of forest cover involved in constructing the EACOP is particularly problematic considering Uganda is already losing about 90,000 hectares of forest per year.

The pipeline will further pose threats to critical sources of water. Approximately 460 km of the pipeline will be within the freshwater basin of Lake Victoria, Africa’s largest lake, which directly supports the livelihoods of more than 40 million people in the region. The pipeline also crosses the Kamugenyi, Wambabya, Kanywabarogo, and Kifenyi rivers, and the Kijubya and Lwemido swamps in Uganda.

It is important to note that Uganda is a signatory to RAMSAR Convention and the UNESCO Conventions on conservation which call for the proper conservation of World Heritage sites located in their territory.  

These conventions make it mandatory for all signatory countries to commit to avoid any activities that might directly or indirectly degrade the cultural and natural heritage of these sites and if oil exploration is undertaken in these areas and other sensitive ecosystems, it would be an abuse of their commitment.

In addition, Uganda is a signatory to the Paris Agreement on Climate Change which came into force during the 21st Conference of Parties (COP) meeting in Paris France. The agreement calls on all signatory countries to cut their Greenhouse Gas Emission (GHG) and limit the global temperature rise to less than 2 Degrees centigrade or to 1.5 pre-industrial level.

These commitments mandate the signatory country to ensure that any activities that result in the generation and release of greenhouse emissions into the atmosphere are limited and for which oil exploration and production is the highest generator of these gasses.

The 2018 Intergovernmental Panels on Climate Change (IPCC) report 2018 called on all United Nations Framework Convention on Climate Change (UNFCCC) member countries of which Uganda is among, committed to further cut their emissions way beyond the commitments made in the Nationally Determined Contributions if the 2030 goal is to be achieved.  

As an Environmental Engineer and conservationist, the exploration and production of oil around the world has negatively impacted on the local and host communities including women, children, elderly and others resulting from the mass displacement of communities from their land, clearance of vegetation which affects agriculture and livelihoods of communities and others.

All these activities leave communities worse off than they were before oil was discovered in their areas and remain a burden to governments. The contamination of water by oil spills causes health problems such as cancer, premature births, high rates of miscarriages and others.

The EACOP will have risks on the accumulation or disposal of hazardous waste. The pipeline will most likely have to be regularly cleaned, and this cleaning generates hazardous waste containing benzene, a human carcinogen.

This waste will have to be either incinerated, which can generate hazardous air pollution, or be disposed of in storage sites at each pumping station, meaning each pumping station would become a hazardous-waste disposal site.

Uganda is blessed with huge potential of alternative renewable energy sources in form of solar, wind power, geothermal and other which offer better alternatives to oil while conserving the environment. If we invested in our renewable energy sources as opposed to oil, our country would generate much more revenue than the oil developments.

Therefore, oil developments shouldn’t be conducted at the expense of environmental conservation and protection of sensitive ecosystems.

The writer is an Environmental Engineer at AFIEGO.

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Increase Investments In Clean Energy

By Pedun Spencer

On 11th April 2021, the Ugandan and Tanzanian presidents met at statehouse Entebbe to sign the tariffs and transportation agreement, the host government agreement for the republic of Uganda and the shareholding agreement for stakeholders to pave the way for the construction of a 1,445 km electrically heated crude oil pipeline from Uganda's Albertine region to Tanzanian seaport of Tanga.

During the signing, Hon. Sam Kuteesa, Uganda's foreign minister retaliated that the signed agreements will bring in an equal project for all people of Uganda and Tanzania in the spirit of East Africa.

It is unfortunate that over 70% of the 400 oil wells under Total E&P (U) Ltd.’s Tilenga project are in Murchison Falls National Park which will seriously lead to increased destruction of wildlife habitats.

The well pads, pipelines, roads, oil workers’ camps, noise, dust, crossing River Nile and other oil infrastructure that will be developed under the Tilenga project will fundamentally affect both the parks, waterfalls, forests and lakes which Uganda and Tanzania are heavily dependent on as a source of food, raw materials, medicinal plants and others from which income is generated for livelihoods.

In addition, the climate change risks that are posed by the EACOP project are huge and the available estimates indicate that the crude oil transported by the EACOP will result in the production of 34.3 million metric tons of carbon per year, thereby exacerbating climate change.

Worsening of climate change is not only against the goals of the Paris Climate Change Agreement, to which Uganda and Tanzania are signatories but also spells doom to Ugandan and Tanzanian citizens, who are among the world’s most vulnerable populations to climate change impacts.

Indeed, at a time when Ugandan and Tanzanian citizens are suffering impacts such as floods, mudslides, landslides, locust invasions, death and others, it would be most unwise to invest in the EACOP.

The government is not doing enough in helping communities to access clean energy options. For over five years now, the Ministry of Energy has been one of the top three to four sectors as far as budgetary allocations are concerned. The money given to the Ministry of Energy has not resulted in higher access to clean energy; only about 24 percent of Uganda's population has access to electricity and in rural areas, this number comes up to a mere 10 percent

In conclusion, l call upon the government to priorities investment in clean energy in line with Uganda’s Nationally Determined contributions to cut her greenhouse gas emissions and in line with the Paris Climate Change Agreement that call for limiting global temperature rise for which exploiting oil would be acting in contrary. 

For God and my Country

Pedun Spencer, Project Assistant, Environment Governance Institute (EGI)

Greenpeace, Western Anti Africa Energy Groups Wrong On EACOP

By NJ Ayuk

If someone were to put me on the spot and ask me to name an environmentalist group, I’d probably blurt out the first thing that comes to mind, Greenpeace. There are obvious reasons for this: Greenpeace has been around for more than 50 years, and it has done a masterful job of bringing environmental concerns to the world’s attention and keeping them there. The group has a strong track record when it comes to advocacy and awareness, and it has a global reach. It’s truly one of the most visible non-governmental organizations (NGOs) in the world.

And that’s why I see it as significant that Greenpeace’s African division has come out swinging for a major new oil pipeline slated for construction in Uganda and Tanzania. Let me explain what I mean.

What’s at Stake

On April 14, Greenpeace issued a statement expressing dismay about the signing of a new agreement on the East Africa Crude Oil Pipeline (EACOP), a midstream project involving Uganda, Tanzania, the French major Total, and China National Offshore Oil Corp. (CNOOC).

The agreement serves to remove one of the final obstacles to the building of the pipeline, which will transport crude oil from fields in western Uganda, near Lake Albert, to a port on the Tanzanian coast. As such, it also clears the way for Total and CNOOC to set a concrete schedule for development of the upstream assets that will fill the line — and for investors to start pumping more than $5 billion into East Africa.

Greenpeace believes that Uganda and Tanzania ought to turn down this foreign direct investment (FDI). They explained their position by pointing out that EACOP poses environmental risks - which is hardly surprising, given their record on all seven continents. But they also argued that there were hard economic and political reasons to ditch the pipeline. Specifically, Greenpeace asserted that the building of the pipeline would have the following negative effects:

  • It would stymie the development of renewable energy and the creation of so-called green jobs.
  • It would benefit large multi-national corporations and not local communities.
  • It would involve Uganda and Tanzania in “neo-colonial projects.”

These are strong words to use, and they deserve a strong — and serious — response from Africans.

I have one: Greenpeace and Western Anti African energy groups, you’re wrong.

Oil vs. Renewables: “Both-And,” Not “Either-Or”

First, you’re wrong to predict that renewables will be crowded out if an oil pipeline is built. That’s not true.

EACOP is an export-oriented project, in that it’s designed to pump 216,000 barrels per day (bpd) of oil, or about 83% of peak output from Uganda’s Kingfisher and Tilenga fields, to the Tanzanian coast so that it can be loaded onto tankers and sold on the world market. In other words, most of Uganda’s oil won’t be going to refineries so that it can be processed into fuel for local power plants.

As a result, EACOP won’t help Uganda or Tanzania overcome their domestic energy deficits, which are considerable. These two countries will still need more electricity to support industrialization initiatives and improve citizens’ quality of life after the pipeline is built. They’ll still need power plants — and they should try to meet that need by building solar farms, wind parks, and hydroelectric dams.

I happen to think they should also build natural gas-fired thermal power plants (TPPs), which boast lower emissions than facilities that burn petroleum products, but my point is: There’s nothing about building an oil pipeline that takes renewable energy off the table. (In fact, small-scale, locally-oriented renewable facilities may also have the advantage of not being subject to the deficiencies of East Africa’s transmission networks.)

So it’s wrong to describe this as an “either-or” situation, in which a binary choice must be made. It’s a “both-and” situation. Tanzania and Uganda stand to benefit from pursuing both renewables and an oil pipeline. Let’s not stand in their way by framing the matter incorrectly.

Local Impact and Local Content

Second, you’re wrong to conclude that EACOP overlooks the interests of Ugandan and Tanzanian citizens and the communities along the pipeline route.

Yes, Total and other corporations involved stand to benefit from this project. (If they didn’t, they’d never agree to pump billions of dollars into it, and they might have a hard time convincing reputable service providers to sign contracts.) Greenpeace has never invested in any country and has never created a job. Okay they create a few jobs for drivers of the western aid workers in Africa.

But Uganda and Tanzania will benefit, too from Total’s investment. These two countries will earn revenues from oil flows through the pipeline and from oil sales. (Uganda alone may bring in as much as US$2 billion per annum over a period of at least 20 years.) Their governments will collect taxes from the local contractors that see their income rise as a result of their involvement in the project.

Their businesses will profit from dealings with Total and CNOOC, which will have to hire local contractors in order to comply with local-content regulations and uphold their own contractual commitments. Their people will reap the rewards of the social welfare and infrastructure development projects these companies plan to carry out. Their societies as a whole will benefit from the construction of new infrastructure facilities such as roads, airports, hotels, and communications networks.

What’s more, ordinary Ugandans and Tanzanians will have a better chance of finding work once Total starts building the pipeline, for this project promises to create jobs — tens of thousands of them, and perhaps more than 100,000 of them overall. Samia Suluhu Hassan, the president of Tanzania, said on April 11 that she expected EACOP to create at least 10,000 jobs.

Mary Goretti Kitutu, the energy minister of Uganda, went into more detail, saying on the same day that she expected around 14,000 men and women to be hired directly by Total and CNOOC. About 57% of these people will be local workers, she added. She also stated that the upstream and midstream projects were likely to create many more jobs indirectly, with contractors to Total and CNOOC hiring around 45,000 people and businesses in other sectors taking on perhaps another 105,000 employees to handle the extra activity arising from oil operations. Facts and truth can be stubborn for those who believe foreign aid, begging and immigration to Europe should be the only way out for African youth.

Of course, these jobs won’t all last forever. Many of them will involve construction or related activities, and these will naturally come to an end once the construction projects are finished. While they exist, though, they will give tens of thousands of Africans the chance to earn larger salaries — and, potentially, gain more experience and obtain more training than they had before and start a sustainable business. As such, they have the potential to improve tens of thousands of lives in Africa — not just by increasing wages, but by creating opportunities for local workers to pick up skills they can still use after the pipeline is finished.

So it’s wrong for Greenpeace and the anti-African energy crowd to say these projects merely pay lip service to local communities. Officials in Uganda and Tanzania have worked hard to ensure that the EACOP project has a far-reaching and positive impact, and they have established new laws and policies to guard their citizens’ interests.

Take Up the NGO’s Burden: Who Are the Real Neo-Colonialists?

Finally, Greenpeace and the western anti-African energy crowd are wrong to describe EACOP as a “neo-colonial” endeavor. Come on this gives Chutzpah a new meaning.

Yes, there are foreign companies involved – Total, based in France, a former colonial power, and CNOOC, a company based in China, a rising power that stands ready to assist less-developed countries, provided that they agree to loan terms that are sometimes predatory. And yes, the largest portion of the EACOP consortium has been assigned to Total, which holds a stake of 72%. (CNOOC, meanwhile, has 8%.) But these foreign companies aren’t working alone. EACOP will also include Uganda National Oil Co. (UNOC), with 15%, and Tanzania Petroleum Development Corp. (TPDC), with 5%.

Take a close look at those numbers Greenpeace. You’ll see that both transit states have an equity stake in the pipeline — and that one of them has a larger stake than Total’s Chinese partner. Let me also point out that even if Total does have the largest stake, it is also serving as operator of the project and will assume most of the risk. As such, it stands to lose much more than UNOC, TPDC, or CNOOC if EACOP fails. That is how free markets works. You can’t love jobs and hate those who create jobs. Let’s face it, we in Africa need more free markets than communism. Free markets are still our best path to prosperity.

Tell me, how exactly is this a “neo-colonial” arrangement? Have Uganda and Tanzania really bowed under pressure from powerful external forces, or have they spent years negotiating a deal with two foreign companies that agreed to their conditions?

And speaking of pressure from powerful external forces, is Greenpeace’s approach truly free of “neo-colonial” elements? I didn’t know Greenpeace was a Pan Africanist NGO. Is the NGO using its position as one of the world’s most well-known environmental groups to ensure that local environmental advocates have a bigger bully pulpit? Is its opposition to EACOP rooted in the dreams and desires of ordinary Ugandans and Tanzanians, or is it trying to impose a solution from outside, on the basis of the global environmental movement’s pre-existing animus towards fossil fuels?

It’s wrong to use a historically and emotionally loaded word like “neo-colonialism” in this instance. It’s wrong to imply that Tanzania and Uganda have been coerced into working with foreign corporations, and it’s wrong to invoke colonialism in the hope of convincing Africans to listen to a different group of people who think they know best. Let Africans decide for themselves!

Balancing Environmental Risks with Other Crucial Considerations

Listen, I don’t fault Greenpeace for the concerns it expresses about environmental risks.

The NGO is not wrong to point out that with pipelines, there will always be the danger of spills, leaks, and damage to surrounding ecosystems and habitats. I hope it continues to advocate fiercely for the African landscapes that Greenpeace mentions, such as the Murchison Falls National Park, which is the largest and oldest nature reserve in Uganda. That advocacy is its mission — and frankly, the business community needs to listen to critics as well as cheerleaders so that it can learn, improve, and give back to host communities. (Government officials must do the same so that they protect their constituents even as they guard revenue streams.)

But Greenpeace is wrong to argue that EACOP is not worth pursuing because it will overshadow renewable energy, because it will ignore the interests of the countries involved, or because it represents some type of neo-colonialism. Instead, it’s overstepping - and in the process of doing so, it’s wasting time that could be spent looking for ways to balance environmental protection with other crucial considerations, such as job markets, entrepreneurship, energy poverty, and budget revenues.

So let’s not waste any more time. Let’s strive towards that balance.

Let’s start now.

Dear Presidents Museveni & Suluhu Hassan

By Vanessa Nakate & Landry Ninteretse 

As you were signing the long-awaited contract that will finally allow the construction of the East Africa Crude Oil Pipeline - African longest crude oil pipeline - hundreds of young people, activists, environmentalists and ordinary citizens from all over the world, including representatives from East Africa, were gathered online for workshops, panels and discussions focused on a just and sustainable recovery not only from the COVID-19 pandemic, but also from the climate crisis and other multiple socio-economic injustices facing our communities, particularly in southern countries.

The three agreements you signed with the French oil companies Total and the China National Offshore Oil Corporation pave the way for the construction of the pipeline that will run through a number of sensitive biodiversity areas and wetlands of designated international importance in your countries. You were delighted with this progress described as "the core of bigger developments," and even invited neighboring countries to use the pipeline.

As East African citizens and climate activists, it is our duty to share with you and with the public our regrets and deepest concerns that these oil projects and the linked pipeline are going to have on our communities, our ecosystems, our climate as well as our future as a regional block with a common and shared destiny. You may have heard these concerns before but we thought they are worth raising again at this particular moment when the launching seems imminent.

A project with multiple dire social, economic and environmental impacts

Firstly, the construction of a 1,443 km long heated pipeline that crosses several villages and towns in both Uganda and Tanzania will have - and is already having - enormous consequences on local populations. Most of the communities affected by Total's projects have clearly indicated that they are not actually free to use the land as they wish. Such restrictions on rural and farmers communities have dire effects on their livelihoods, and consequently, on their right to food, education and health. Put simply, this project is undermining the well-being of over 80,000 people in both countries.

Secondly, the pipeline poses significant risks to critical water sources, wetlands and several rivers in both countries.  Approximately 460 km of the pipeline will be within the freshwater basin of Lake Victoria, Africa's largest lake, which directly supports the livelihoods of more than 40 million people in the region. What would happen to such people in a likely scenario of oil spills? Are both countries well equipped to handle such disasters and to prevent pollution and ensure clean water access to such a large population?

Thirdly, the pipeline clearly threatens one of the most ecologically diverse and wildlife-rich regions of the world. This is a region home to a number of unique, iconic and endangered animals which have been attracting thousands of tourists. What would happen to the local tourism industry, a source of livelihood to thousands in both countries? Will all of them be employed by the oil projects? What are the mitigation measures in place to address the strong potential loss of jobs in the tourism sector and the related local socio-economic sectors?

Fourthly, allow us the opportunity to remind you that the project is estimated to generate over 34 million tons of carbon emissions each year. This is an unimaginable prospect as the scientific community, as well as world leaders have agreed that all new fossil fuels must be kept in  the ground if we are to reach the goals set by the Paris Climate Agreement you have adhered to in order to avoid further catastrophic climate change.

Though the East African region, and Africa at large bear the least responsibility for rising emissions, this shouldn't serve as an excuse to add tons of extra millions tons of carbon emissions yearly. As the wiseman said, every adversity contains within it the seeds of opportunity and growth.

Today's climate challenge and associated crisis should be seen as a golden opportunity for Africa to develop in a way that is truly fair and sustainable and that prioritises the interests and well-being and future of its youthful population. Uganda, Tanzania and many other African nations are blessed with abundant sources of energy that are clean and green that can satisfy its current and future energy needs while creating thousands of jobs.

Do you know who you are dealing with?

As we conclude this letter, allow us to highlight a few facts about Total, the largest shareholder of the deals recently concluded. This is a multinational which has been behind some of gravest environmental degradation and several human rights violations in Africa and beyond. From Algeria to Cameroon, from Libya, Angola to Nigeria. Total is gradually withdrawing from Central and West Africa over the depletion of resources and now extending its operations in Eastern and Southern Africa. We don't want to see our dear region transformed into another Niger Delta in the name of oil business.

In the specific case of EACOP, Total has failed to respond to the urgent needs of affected communities and repeated alerts from civil society and claimed to have plans to 'avoid, minimise, mitigate or compensate potential risks or threats to the environment and people' as part of its greenwashing communication that you should be aware of. The oil giant is facing a legal action in France based on the law on the duty of vigilance of multinationals, in order to force it to develop and effectively implement adequate measures capable of putting an end to the violations of human rights and prevent future violations as well as irreversible damage to the environment and climate.

Your Excellencies, building the world's longest heated crude oil pipeline in the midst of a climate emergency is a terrible development that must be stopped. No responsible government or ethical financial institution or operator should venture into such deadly business at this stage. We sincerely hope you will reconsider this ill advised project which is likely to benefit only Total and CNOOCat the expense of local communities hardly hit by the effects of climate crisis and pandemic.

Yours sincerely.
Vanessa Nakate, Climate Activist, Founder of RiseUp Movement
Landry Ninteretse, 350Africa.org Regional Director

EACOP Will Disenfranchise Local Communities In Uganda & Tanzania

By Charity Migwi, Edwin Mumbere & Evelyn Acham

The East African Crude Oil Pipeline (EACOP) is expected to reach a Final Investment Decision (FID) as soon as the end of March 2021.This will pave way for the commencement of the construction phase of the pipeline.

South Africa’s Standard Bank, Japan’s Sumitomo Mitsui Banking Corporation (SMBC) and Industrial and Commercial Bank of China (ICBC) are among the lead financial advisers intending to secure $3.5 billion to fund the construction of this pipeline projected to release 34.3 million tons of carbon into the atmosphere each year once complete.

This comes at a time when the entire world is aiming to remain within the recommended 1.50C and abide by the principles of the Paris Agreement.

In a statement to an inquiry by Uganda's Daily Monitor, Standard Bank claimed to have suspended their financial support to the disastrous project as they await an independent Environmental and Social Impact Assessment (ESIA).

This process is, however, standard practice under the Equator Principle and it seems that Standard Bank is merely pointing to its routine due diligence process with little regard to the call by numerous Civil Society Organizations (CSOs) and local communities to withdraw their support to such an irreversibly damaging project.

High risks and meagre earnings for both countries

The EACOP is touted as the project that will unlock East Africa’s future by taking Uganda’s oil to the rest of the world. This will supposedly increase the Foreign Direct Investment (FDI) for both countries by over 60% during the construction phase.

Conversely, the value of Uganda’s oil reserves has already fallen by approximately 70% since 2013. This value is expected to fall even further as the world transitions into a low-carbon economy.

Even from the Tanzania ESIA it estimated that the government will only get $240 million from the project after its construction, which is peanuts compared to the environmental and social implications faced.

Furthermore, the Ugandan government is bound to accrue losses of up to $1.4 billion, much more than the $130 million that the Ministry of Finance intends to borrow from the domestic market. Public debt is already projected to rise to 54.1% by 2023 in Uganda.

The EACOP project thus risks driving East Africa further into unsustainable debt at the mere prospect of reaping meagre earnings with the only entities bound to benefit being the foreign oil companies such as Total.

No government should take such dire economic risks and push the lives of its already struggling citizens into deeper poverty. Standard Bank in cahoots with other major EACOP proponents are, however, resolutely keen on baking debts, the kind that future generations will still be tasting decades from now.

East Africa does not need oil or any fossil fuels to unlock its future especially when there are viable, affordable and clean alternative sources of energy such as solar and wind, which are renewable and have better prospects when it comes to long-term job opportunities. East Africa needs to focus on a just transition to renewable energy that guarantees the extensive deployment of millions of clean jobs .

EACOP bound to destroy lives and natural habitats

The proponents of the pipeline have claimed that EACOP will create short term employment for highly skilled and semi-skilled professionals, as well as casual laborers over a period of 2 to 3 years. It is estimated that 10,000 jobs would be created during the construction phase, boosting the income of the households along the pipeline.

However, what we have witnessed in Uganda, Tanzania as well as other East African countries, very few jobs are usually allocated to the local community, thus leaving them even more vulnerable and disenfranchised.

The project will result in the physical displacement of local communities from their ancestral and communal land. It is anticipated that EACOP will directly affect approximately 14,000 households in Tanzania and Uganda leading to loss of income and livelihoods.

Moreover, the pipeline risks polluting water resources of which over 40 million people in 9 countries depend on; an unacceptable human rights violation.

Beyond ruining people’s lives, the pipeline will tear through some of the world’s most significant habitats, home to endangered species including African elephants, chimpanzees and lions, pushing them ever closer to extinction.

What can Standard Bank and other financial institutions do?

By playing an advisory role and without a clear commitment to withdraw their financial support from the EACOP project, Standard Bank will be fueling the transition of billions of dollars from public coffers into the pockets of a few fossil fuel proponents who are undoubtedly ready to create tons of emissions that will lead to a planet choking on carbon and exacerbate the already worsening climate crisis, making it extremely difficult for an already vulnerable continent experiencing the adverse effects of climate change.

 

Standard Bank has a responsibility to take care of the people and the planet by leading a new pathway for Africa through spurring investment in renewable energy that will guarantee access to cheaper and cleaner power across Africa, and in the process create jobs for millions of youth across the continent.

At a time when millions of petitioners have protested against the EACOP, Standard Bank needs to follow in the footsteps of Barclays Bank and Credit Suisse, who have publicly committed to not financing the disastrous EACOP project. The future needs banks that are committed to having a fossil fuel exclusion policy and an investment plan that unlocks Africa’s future with 100% renewables.

By Charity Migwi of 350Africa.org, Edwin Mumbere of the Center for Citizens Conserving (CECIC) and Evelyn Acham of the Rise Up Movement.

Response To Hussein Lumumba Amin On Government Of Uganda’s Take From The Oil And Gas Sector

By Ali Ssekatawa

The assertion that Uganda got a bad deal from the oil and gas projects and will only earn $5 per barrel is not only factually wrong but does not make logical sense. Mr. Hussein Lumumba Amin ignorantly mixes up the economics of the upstream with the midstream. To understand Government’s expected take/revenue from the sector, these two segments of the petroleum value chain must be understood/ explained separately.

The crux of his faulty and bizarre thesis is captured below;

“Let's do the simple maths in five seconds.

Today a barrel of oil costs $60 Dollars. Now the oil companies will get 70% of that which is $42. And the Tanzanian government charges $12.77 as transit tax for each barrel of oil passing on the Tanzanian potion of the pipeline.

The oil companies and Tanzanian government take $55 dollars from the $60 dollars of each barrel, leaving Uganda to take only $5 dollars from each barrel of its own oil.

Even a kid will know they have gotten a bad deal.”

If we begin with the Midstream, the agreed commercial structure for the East African Crude Oil Pipeline (EACOP) as per the Shareholder’s agreement is that the project is jointly funded and owned by the Governments of Uganda and Tanzania, and the oil companies.  The agreed shareholding is Total with participation of 62%, CNOOC Limited at 8%, Government of Uganda through the Ugandan National Oil Company (UNOC) with 15%, and Government of Tanzania through the Tanzania Petroleum Development Corporation (TPDC) agreeing to take up to 15%.

Mr Hussein missed the turn when he presumably added up the 62% shareholding of Total BV and CNOOC’s 8% in the EACOP, and  came up with a bizarre 70% which he confused  with the petroleum revenues in the upstream.

Equally important to note is that his assertion that the agreed Tariff of US$12.77 is payable to only Tanzania, is to take an unchartered journey into the abyss. The EACOP Company (of which Uganda is a shareholder) will receive the tariff (Transportation charge) and, therefore, Uganda as a shareholder through UNOC, will partake of any dividends arising from it. The tariff is not paid to Tanzania, which also exempted EACOP from payment of a transit fee, in any case.

For the Upstream, Government revenues from the oil and gas sector include royalties, profit oil share, state participation and taxes. The Production Sharing Agreements (PSAs) signed between Governments and the Oil companies provide for the sharing of petroleum during production. The International Oil Company (IOC) invests capital to explore and develop the resources.   When production of oil starts, Government first receives a royalty payment of between 5% to 12.5% depending on the level of production.  Then, the next deduction goes to recovery of the oil company’s costs, which is capped at 60% to 70% of the remaining ‘oil’ after royalty deduction. The next payment is considered as profit oil, which is shared between the Company and Government as per the PSAs. Government also receives corporate tax (approx. 30%) on the oil company’s share of profit oil. Government’s total take from the upstream, as per the current PSAs, therefore, ranges from between 65% to 80%, it increases over the years, given that there will be less costs to recover.

The overall projected annual revenues from the sector are estimated at US$1.5bn to US$ 2bn.  Besides the revenues, the expected investments of US$15bn over the next four years when construction of the infrastructure will take place, is an immense opportunity for the country through the provision of the required goods and services.  In addition, the oil and gas sector will have a positive economic impact on other growth sectors of the economy such as manufacturing, tourism, agriculture, health, among others.  It is projected that these linkages will increase Uganda’s revenue/ GDP by US$ 8.4 billion before first oil.

Whereas we appreciate the interest in the development of the sector, it is important that the information shared should be based on facts.  A cursory look at any of the PAU/UNOC/MEMD websites would reveal these basic facts. It is also a sign of strength and not a weakness to consult. The oil and gas sector has potential to cause positive social and economic transformation in the country and therefore calls for sober and objective discourse.

The writer is the Director Legal and Corporate Affairs

Email; This email address is being protected from spambots. You need JavaScript enabled to view it.

 

BLACK GOLD: Uganda Smiling At The Oil Resource Curse

By Cirrus Kabaale

This week, the world witnessed the signing of the tripartite agreement for the East African Crude Oil Pipeline (EACOP) project. The agreement was signed by the Ugandan President H.E Yoweri Kaguta Museveni and Tanzanian President H.E Samia Suluhu Hassan at a ceremony that was held in statehouse Entebbe, Uganda.

The two heads of state noted that they had taken steps to conclude tariff and transportation agreements, the host government agreement (HGA) for Uganda and the shareholding agreement on EACOP.

As partners, we commemorate our government’s efforts to ensure that first oil flow by 2025. The signing of agreements was a major milestone that brings Uganda closer to producing crude oil and to economic prosperity.

During the ceremony, both heads of states made promises of huge investments, jobs and development of other sectors that created quite the excitement among members of the governments and private sector. 

Amidst the excitement, discussions on the environmental, climatic, economic and social risks, threats and costs of the EACOP were relegated.

The 1,445km-EACOP, stands to be the longest heated pipeline in the world and environmental footprint are too huge at a time when Uganda, Tanzania and other countries are engaged in efforts to reduce their carbon emissions in line with the Paris Climate Change Agreement, the EACOP will hamper these efforts through the production of an estimated 34.3 million metric tonnes of carbon per year when the crude oil transported by the pipeline is burnt.

The oil activities are gravely impacting or stand to gravely impact food security, water access, biodiversity and environmental conservation, tourism, fisheries and other income-generating activities.

The mitigation measures that Total E&P, CNOOC provided under the Environmental and Social Impact Assessment (ESIA) reports for the Tilenga, EACOP and Kingfisher projects are inadequate. In Africa, oil companies rarely implement their proposed mitigation measures. Instead, they engage in the worst environmental and human rights abuses. 

Investing in the EACOP at a time when countries and oil companies are engaged in efforts to transition to clean energy from fossil fuels. Companies, investors and others are divesting from the oil and gas industry not only because of climate change concerns but because the above players estimate that the profitability of the oil industry is set to lessen due to lower demand for oil and gas as more and more countries transition to clean energy. 

A number of countries and cities have set dates, by 2040 latest, by which they will have phased out fossil fuel cars. Cars account for 26% of oil and gas consumption worldwide. If the phase-out happens, there will be a decline in the demand for oil. 

Further, under its Green Deal, European Union member countries have set targets of attaining net-zero emissions by 2050. European oil and gas majors such as Total, Shell, Eni and BP have consequently set targets to attain the above goal by 2050. To attain the goal, they are slashing budgets for oil and gas while increasing investments in clean energy. 

These actions are telling; the companies know that one way or another, fossil fuels will be phased out or their use will be reduced. While oil majors are slashing oil sector budgets, Uganda is investing in the sector. 

It is notable that amidst the above threats, a substantial amount of money that Ugandans and Tanzanians can ill afford stands to be invested in the EACOP. It is expected that $3.5 billion will be invested in the EACOP and of this, $2.5 billion is expected to be borrowed. This will push up Uganda and Tanzania’s indebtedness. 

The available estimates indicate that the crude oil transported by the EACOP will result in the production of 34.3 million metric tonnes of carbon per year, thereby exacerbating climate change.

Worsening of climate change is not only against the goals of the Paris Climate Change Agreement, to which Uganda and Tanzania are signatories but also spells doom to Ugandan and Tanzanian citizens, who are among the world’s most vulnerable populations to climate change impacts.

Indeed, at a time when Ugandan and Tanzanian citizens are suffering impacts such as floods, mudslides, landslides, locust invasions, death and others, it would be most unwise to invest in the EACOP.

Therefore, the energy transition efforts that are going on worldwide will have an impact on the viability of and job prospects in Uganda’s oil and gas sector.

The government’s investment in the oil and gas sector at a time when an energy transition is ongoing and even the European oil and gas majors are reducing investment in the sector will also mean that Uganda will be stuck with infrastructure that provides less value than the investment made in the infrastructure. Ugandans could also be forced to continue depending on oil and gas, which has grave negative impacts on the environment, climate change efforts, health and human rights.

To prevent the above negative impacts, the government needs to rethink investment in the oil and gas sector and should promote clean energy.

For God and My Country

Cirrus Kabaale, Project Officer at Environment Governance Institute (EGI)

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