Japanese firm to lay a 2,000 km pipeline to export South Sudan and Uganda's oil
A Japanese firm is set to lay down 2,000 kilometres of pipeline for oil exports from South Sudan and Uganda via Kenya. Kyodo, a Japanese news agency reported last week that Hiroshi Suzuki, President of Toyota Tsusho East Africa Ltd, had said his company, Uganda, South Sudan and Kenya "possibly" within this year will create a joint company to construct and maintain the oil pipeline.
Last year the Presidents of Kenya, South Sudan and Ethiopia met in Mombasa to launch construction of a port and a pipeline at a total cost of US$16 billion. Uganda's President Yoweri Museveni did not attend the meeting. The project of Toyota Tsusho aims to connect the South Sudan-Kenya pipeline with another from western Uganda. Once completed, the pipeline will enable South Sudan to transport its oil through the Kenyan part of Lamu instead of the Red Sea in Sudan.
South Sudan and Sudan have had an up and down relationship over the latter's use of the former's pipeline to export oil. In June Sudan threatened to halt South Sudan oil flow through its territory, after accusing Juba of supporting rebel groups but Khartoum did not implement the threat. With a pipeline that bypasses Khartoum, South Sudan would have a sense of stability without fear of threats to oil flow which is the lifeline of its economy.
Uganda like South Sudan is a landlocked but will be able use the pipeline to export her oil through Kenya. Uganda has 3.5 million barrels of oil near Lake Albert which borders Uganda and the Democratic Republic of the Congo (DRC). Uganda's oil production is expected to begin around 2017. Hiroshi Suzuki, President of Toyota Tsusho East Africa Ltd said the company needs US$ 5 billion to invest in the project.