Campaigners Seek to Block Chinese Financing for EACOP Pipeline

Campaigners Seek to Block Chinese Financing for EACOP Pipeline
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The stop EACOP campaigners have changed their focus and are now directing their efforts towards Chinese banks and insurance companies to prevent them from funding the longest crude oil pipeline connecting Uganda and Tanzania.

Previously, these campaigners had protested against Western banks and insurance firms, successfully preventing them from supporting the project, which aims to transport crude oil from Uganda’s Albertine Graben to Tanzania’s port of Tanga.

Reports indicate that Chinese leaders are considering covering the $1.8 billion required to fund the entire pipeline project. Engineer Irene Batebe, the permanent secretary of Uganda’s Ministry of Energy and Mineral Development, mentioned that negotiations with Chinese financiers for the debt component of the pipeline’s financing were nearing completion.

This development followed the announcement that TotalEnergies, the lead investor in the EACOP project, had signed an agreement with China Petroleum Pipeline Engineering (CPP) for the pipeline’s supply and construction.

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These recent developments have prompted the #StopEACOP campaigners to shift their focus from Western institutions to Chinese sources, aligning with Uganda’s government, which has redirected some of its oil and gas infrastructure development towards China.

The campaigners have taken their concerns to the China Export and Credit Insurance Corporation (Sinosure) and the Export-Import Bank of China (China Exim Bank) by collecting signatures from over two thousand residents in various affected districts, including Hoima, Bulisa, and Kikuube. They have urged Sinosure and China Exim Bank to conduct an independent field visit in collaboration with affected communities before making any decisions regarding the EACOP project.

The campaigners reference a statement by Ms. Irene Batebe in September 2023, suggesting that the Exim Bank of China and Sinosure would provide more than half of the $3 billion loan required for the EACOP project.

According to the campaigners, the EACOP, Kingfisher, and Tilenga oil projects have resulted in the displacement of 13,546 households in Uganda and Tanzania, affecting over 86,000 people. They argue that these displacements have involved violations of Uganda’s 1995 Constitution and International Finance Corporation Performance Standards, leading to consequences such as food shortages, income losses, and school dropouts.

The campaigners also highlight the impact on Lake Albert, where the Kingfisher oil project is based. They claim that some fisherfolk have lost access to fishing grounds due to the activities of the project and the light from the Kingfisher oil rig. This has pushed some fisherfolk to fish in the part of Lake Albert located in the Democratic Republic of Congo (DRC), where they face insecurity. These concerns were not addressed in previous campaigns targeting Western funders.

Despite these claims, the government has disputed them, acknowledging some delays in resettling Project-Affected Persons (PAPs), especially those who opted for houses to be built for them. According to the Petroleum Authority, the land acquisition process for the Kingfisher and Tilenga projects is nearly complete, with the majority of PAPs compensated and some resettlement houses provided. The EACOP project is still in the compensation process, with progress reported on land acquisition and the handling of cultural sites and graves.

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