Uganda appoints banks to raise capital for crude oil pipeline

An oil pipeline similar to what Uganda is embarking on constructing from Tanga in Tanzania to Hoima in Uganda

Standard Bank Group’s Ugandan unit plans to raise $3 billion (€2.56bn) for a crude pipeline by the second half of next year as the east African country prepares to start oil production by 2020.

According to The Irish Times, Oil and gas exploration company Tullow Oil, which was founded in Co Carlow, is jointly developing Uganda’s oil finds with French company Total and Chinese company Cno

Stanbic Bank Uganda was appointed alongside Japan’s Sumitomo Mitsui Banking as joint financial adviser for the 1,445km pipeline, Patrick Mweheire, the chief executive of the Uganda-based business, said in an interview on Tuesday.

He said the companies would explore raising bank debt or loans from export credit agencies among the options they were considering.

The pipeline will connect Uganda’sPatrick Mweheire, the chief executive of the Uganda-based business, in the west to the port of Tanga in neighbouring Tanzania.

Ugandan president Yoweri Museveni and his Tanzanian counterpart John Magufuli commissioned the construction of the $3.5 billion (€2.98bn) pipeline earlier this month.

“A lot of activities are going on, a lot of tenders are being made” and expectations are that the final investment decision for the project will be made in the first quarter of next year, Mr Mweheire said.

He said fundraising for the project would not cause “any currency mismatch” because borrowing could be done in dollars. – Bloomberg

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