Sudanese repair crew work at the Heglig oil facility. Resolving the
pipeline route is vital in helping oil firms involved in Uganda and
Kenya make a final investment decision on developing oil fields. FILE |
NATION MEDIA GROUP
The African
Development Bank (AfDB) is ready to act as a lead arranger for financing
of Kenya's planned oil pipeline to ...
move crude from fields in the far north county of Turkana, a senior official of the bank said on Friday.
move crude from fields in the far north county of Turkana, a senior official of the bank said on Friday.
Kenya
and Uganda have been haggling over which route to choose for an oil
export pipeline that Kenya wants to run through its territory rather
than neighbouring Tanzania, where an alternate project backed by oil
major Total, looks set to get the green light.
Officials
from both countries have been crisscrossing the region, visiting
facilities along the proposed routes, and holding meetings with
executives of oil firms in order to reach a final decision.
"Whatever
comes out of this conversation, one thing is for sure - Kenya will
build a pipeline," said Gabriel Negatu, the Nairobi-based regional
director of the AfDB.
He said South Sudan would
probably link up with Kenya, just based on proximity, as both countries
look to pipe its oil out to the world through the proposed port of Lamu,
which formed part of a broader infrastructure development plan known as
the Lamu Port Southern Sudan-Ethiopia Transport (LAPSSET) Corridor.
"We at the AFDB could consider financing a pipeline through our private sector window," Negatu said.
"We
have said to the various parties who are interested in the pipeline
that we would be happy to be the lead arranger to raise the financing
for this pipeline, whichever way it goes."
Resolving
the pipeline route is vital in helping oil firms involved in Uganda and
Kenya make a final investment decision on developing oil fields.
There
are no figures yet on costs, and production start dates have repeatedly
been postponed, partly over pipeline considerations but also because of
low oil prices.
"The numbers will have to make sense
in the end. There are political risks and economic risks and those will
have to be weighed and costed and the ultimate decision will be a
sovereign decision," Negatu said.
He said the bank
would soon grant millions of dollars to the secretariat of the LAPSSET
Corridor project, so that they could expedite the development of Lamu
port, as well as road and railway infrastructure.
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