Total E&P freezes work on Uganda-Tanzania oil pipeline

French oil major Total, the lead joint venture partner on Uganda’s proposed crude oil export pipeline has frozen all activities on the multibillion-dollar project citing “uncertainty” over its Uganda operation.

Several people familiar with the matter told this website that company executives in Paris also directed its Ugandan oil and gas subsidiary, Total E&P Uganda, to lay off workers as it remains unclear when the ongoing standoff with the Ugandan government will be resolved.

The decision follows last Thursday’s collapse of the farm-down transaction between Anglo-Irish exploration firm Tullow Oil, and Total E&P and Cnooc.

Tullow said it failed to secure a further extension from Uganda of the sale and purchase agreements with its joint partners, Total and Cnooc. The transaction, worth $900m, lapsed on Thursday after government and the three oil companies failed to agree on taxes amounting to $187m.

On Monday, Total E&P’s pipeline project team sent out an email to contractors saying “activities on the project have been suspended until further notice,” sources told this website.

1 Comment

  1. It is strange that too much bureaucracy is undermining development of the dear oil industry. Does President Museveni who I know as very patriotic advise the officials involved in these transactions about dragging their feet too much?

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