The East Africa Crude Oil Pipeline (EACOP) will have huge consequences for Uganda, as well as the planet. Disclosing the contracts behind it will help us properly scrutinise its risks and claimed benefits, writes Robert Tumwesigye Baganda.
Its supporters claim that the East Africa Crude Oil Pipeline (EACOP) will bring Uganda huge benefits.
The champions of the world’s longest heated crude oil pipeline, which will run for 1,443 kilometres from oil fields near Lake Albert in Uganda to Tanga Port in Tanzania and is expected to be completed in 2025, say it will transform East Africa’s energy landscape: propelling Uganda into middle-income status, turning the country into an energy producer for the first time, boosting government revenues by up to $1.2 bn US, increasing foreign direct investment by 60% during its construction, and providing jobs to an economy still suffering from the pandemic.
But to its critics, EACOP is a colossal error. In a world where the impacts of the climate crisis are being increasingly felt, stopping EACOP has become a rallying cause for campaigners around the world.
More than one million people signed a petition for the project to be axed. They say that such a large-scale oil development – between French oil company TotalEnergies, the Chinese state oil developer CNOOC, the Uganda National Oil Company and the Tanzania Petroleum Development Corporation – is incompatible with a world striving towards net zero emissions, pointing out that it will pump an estimated 34 million metric tonnes of carbon dioxide into the atmosphere annually.
Consequently, a growing number of major banks and insurers have ruled out financing the project, citing the pipeline’s environmental threats. Others have documented its risks to the human rights to the communities it will displace, including to their land and their livelihoods, as well as to biodiversity.
This month, conflicting views over the pipeline came to a head.
On September 14, the European Parliament passed a resolution condemning the project. This was swiftly criticised by Ugandan lawmakers. The Ugandan Ambassador to the EU said the resolution was “not informed by facts and fueled by self-seeking groups”.
Given these controversies, and EACOP’s profound economic, social and environmental repercussions, the public should be able to scrutinise the details of an oil deal that will shape their futures, and those of future generations.
Yet the key documents that would reveal answers to critical questions about EACOP remain hidden from the Ugandan public. Fundamental unknowns about the deal include the agreement signed between Uganda and Tanzania, and the one signed between Uganda and the EACOP Company Ltd.
Oil deals rarely benefit the local people who live in areas surrounding the projects. Will this one be any different? Does the deal contain specific anti-corruption measures? What are the findings of the project’s environmental and social impact assessments? What measures are in place to counter any negative economic, social and environmental effects?
There are also questions around the wisdom of building a major new oil pipeline, just as the world moves away from fossil fuels.
Researchers recently estimated that existing oil and gas projects worth $1.4tn US would lose their value if the world moves resolutely to cut carbon emissions in line with the Paris Agreement’s target of limiting global heating to 2°C. Could EACOP become a ‘stranded asset’?
The public needs answers to these and other critical questions about EACOP.
This is why PWYP Uganda – a coalition of more than 45 civil society organisations, and part of the global movement for transparency in oil, gas and mining – are campaigning for the deal’s contracts and agreements to be disclosed.
Our call is in line with the global trend towards transparency in the extractive sector: something which Uganda itself took a significant step towards in August 2020, when it joined the Extractive Industries Transparency Initiative (EITI), the global standard for good governance of oil, gas and mineral resources. The EITI’s requirements include full disclosure of government revenues and all material payments made to governments by companies operating in the oil, gas and mining sectors.
From August 2020, Uganda and the other 55 EITI member countries are required to make their new contracts with oil, gas and mining companies public.
On 14th May this year, in its first EITI report, Uganda acknowledged that the contracts are not published yet.
Information is power, and access to it is a fundamental human right.
Keeping the details of EACOP’s agreements and contracts concealed, means stripping agency from those affected by it, and denying the public the chance to fully understand the risks and rewards of a deal with vast ramifications for Uganda, the rest of Africa and the world.
Data should be disclosed at source through government and corporate databases, online registries, websites and portals to provide citizens and stakeholders with accessible and up to date information on the sector.
The benefits of mandatory disclosure stretch beyond citizens and communities.
For investors, it helps to assess country and project specific governance, reputational and tax risks. For companies, enhanced transparency is good for business, helping to promote a more stable investment climate and secure a social licence to operate. Greater revenue transparency can also improve profitability in foreign investments.
Furthermore, transparency benefits resource governance by providing a tool to the government to build capacity for collecting taxes. Mandatory payments disclosure helps companies credibly communicate their financial contribution to local and national economies.
Transparency also drives out corruption, which Uganda has many laws to combat corruption. These laws cannot be implemented when the contracts are still kept secret.
Therefore, we are calling upon the government to disclose the EACOP contracts signed between the Republic of Uganda and the United Republic of Tanzania and representatives of oil companies CNOOC and Total.
Everyone has the right to participate in decisions that affect them.
Robert Tumwesigye Baganda is the Coordinator of Publish What You Pay (PWYP) Uganda, a coalition of Ugandan civil society groups working to promote good governance and transparency in the country’s extractive sector.
This op-ed has first been published in Mongabay under the title: ‘Disclose the deal,’ East Africa pipeline opponents say (commentary), and a shorter version has been published in the Ugandan media Daily Monitor under the title: We need information on EACOP.