DEAD LOCK: Uganda and Kenya fail to agree on joint Oil Pipeline as Presidents Uhuru and Museveni’s Nairobi bilateral Meeting Yield No Fruits

IT IS NOT YET OVER UNTIL ITS OVER: Though President Yoweri Museveni and his Kenyan counterpart Uhuru Kenyatta held joint talks regarding how they can go about constructing a joint oil pipeline linking Hoima oil fields to the port in Mombasa, the Nairobi talks seemed to have hit a snag.

The Investigator has established that following the ‘failure to agree,’ Energy Minister Irene Muloni and her Permanent Secretary Fred Kabagambe Kaliisa had to remain in Nairobi, locked up in several meetings at the Kenyan Ministry of Energy and Petroleum premises. The two are with Kenyan Energy ministry counterparts assessing how best to resolve the twist.

The meetings that saw the officials visit Lamu and Mombasa ports were geared towards unlocking the ‘collapsed joint oil pipeline construction talks.’ To make matters worse, a group of Kenyan legislators from Turkana County where the Oil pipeline is set to pass have placed very strict conditions to be followed before the pipe passes their land.

The Investigator can report that the MPs led by Turkana North Member of Parliament James Lomenen have also attacked President Uhuru Kenyatta of rushing to enter the oil pipeline deals before consulting the locals.

The pipeline project was designed to move crude oil from the oilfields of Hoima to the Port of Lamu, through Kenya’s own oilfields at Lokichar.

Unlike Uganda where the locals where the oil fields are located were not involved in the oil agreement, the legislators from Turkana have put the Uhuru government to task to ensure that proper infrastructure and laws that will benefit the locals in terms of development of the area are signed first before any deal is entered by any foreign company of country.

Among others, the issue that is making President Museveni un-comfortable is the demand to the Kenyan government by the Kenyan MPs that the pipeline to Uganda should follow the northern corridors and not any other route as supported by President Yoweri Museveni.

The issues of constructing a joint pipeline was routed when Kenyan president Uhuru Kenyatta visited Uganda in August last year but in a twist of events, even after agreeing to the deal during Kenyatta’s visit, Uganda seemed to back track.

Nairobi oil pipeline talks

Last week, President Museveni flew to Nairobi after ending the 10 day NRM retreat for newly elected Members of Parliament at Kyankwanzi to meet Uhuru for bilateral talks on a route for a pipeline to transport the two countries’ oil.

But despite the daylong meeting, sources that attended the meeting revealed to the Investigator that Museveni was not “comfortable” regarding challenges Kenya had to meet to address the issue of land acquisition and compensation for passage of the oil pipe line and current security issues Kenya is facing from the Al Shabab extremists in neighbouring Somalia.

According to the sources, Museveni tasked his Kenyan counterpart to guarantee that security would be paramount before a joint deal was penned.

Experts in the oil industry intimate that a joint deal between Uganda and Kenya is economically viable since it comes with moderate costs compared to going it alone. Constructing an oil pipeline from Hoima oil fields to Tanga would cost USD5.5 billion while a joint venture via the southern route would cost USD4.4 billion compared to USD$4.2billion for the Turkana route (northern).

We have reports that the two states are set to face off in more talks in about one week’s time in Kampala, but should they fail to reach a consensus again, and each nation decides to go alone, Uganda will have part with at least USD$ 4 billion to construct a pipeline from Hoima to any Kenyan port.

When contacted Kenya’s State House spokesman Manoah Esipisu could neither confirm nor deny that the talks ‘collapsed.’ It also emerged that mixed blood seems to be brewing following reports that the Uganda’s oil producers – Irish company Tullow Oil, French company Total and China’s CNOC, that were invited for the Nairobi meetings were literally “locked out”.