Can a regional project for two new oil pipelines be realised with such
volatile neighbourly relations?
At the end of June, the presidents of Uganda, Kenya and Rwanda signed a
memorandum of understanding regarding the construction of two pipelines
across East Africa.
One pipeline would connect South Sudan with Kenya's Lamu port. The other
would extend a pipeline that currently runs between Mombasa port and Eldoret
- both in Kenya - across to Uganda and Rwanda.
The agreement remains in its embryonic stages and does not yet have a
timetable or calculated cost for construction. But the three parties argue
that once it is built, the pipelines will strengthen regional cooperation,
reduce energy costs and transform East Africa into a major energy exporter.
South Sudan would be freed from its dependency on Sudan's infrastructure to
export its resources, while Kenya and Uganda would be able to more easily
exploit their newly-discovered oil reserves.
However, what is good for South Sudan, Kenya and Uganda - and even perhaps
most East Africa - might be seen as detrimental by some of their neighbours
excluded from the agreements, especially the Democratic Republic of Congo
(DRC) and Sudan.
DRC-Uganda: sharing and caring?
Uganda and Kenya currently import their oil from the Gulf region via the
Indian Ocean to Mombasa, where it is refined. However, with the new
pipeline, these two East African nations could exploit their own resources
and provide energy for much of the region.
According to some estimates, for example, Uganda could become a key global
oil producer thanks to the 3.5 billion barrels of crude oil reportedly
discovered close to its border with the Democratic Republic of Congo (DRC).
Exploiting these resources rather than having to import oil would eliminate
tanker transportation, reduce production costs, and lower the price of fuel
for consumers.
However, tapping into this natural resource wealth may not all be plain
sailing. Much of Uganda's oil is around Lake Albert which is sits on the
border with the DRC, and since 2007, tensions have escalated over the
demarcation of this region with both sides moving their militaries to the
border at one point. Tensions defused with the signing of the Ngurdoto
Accords, which established a system for regulating disputes, and earlier
this year, the two neighbours agreed to avoid military presence in oil areas
and to respect each others' territorial integrity. But with diplomatic
relations delicately balanced, proposals of a pipeline could re-ignite the
situation.
To begin with, it is unlikely Kinshasa has forgotten Uganda's previous
involvements regarding natural resources in the DRC. Amidst the insecurity
and instability of the two Congo Wars, Uganda occupied areas of
north-eastern the DRC and extracted the country's mineral wealth, a period
for which the International Court of Justice (ICJ) in 2005 condemned Uganda.
More recently, Uganda was accused in a 2012 UN report of providing weapons
and technical support to the M23 rebels, a group fighting against the
Congolese government, and allowing M23's political unit to operate from
Kampala. Uganda denied these accusations.
With relations frayed, trust a scarce resource between the neighbours, and
border disputes unresolved, the perception that a new pipeline might exploit
the oil around Lake Albert to benefit Uganda at the expense of the DRC could
be dangerous - especially given the ongoing insecurity in the eastern DRC
region.
Sudan and South Sudan: separating the Siamese twins
The other recently-proposed pipeline - from South Sudan to Lamu port in
Kenya - is as, if not even more, controversial.
When South Sudan seceded from Sudan in 2011, it took with it nearly 75% of
the oil reserves. However, the infrastructure for refining, transporting and
exporting the oil is in Sudan. The two Sudans are thus tied in a symbiotic
relationship whereby South Sudan owns the oil, but must pay Sudan transit
fees for using its pipelines, refineries and export terminal at Port Sudan
to sell these resources.
South Sudan relies on oil for 98% of government revenue and has no
alternative to this current arrangement. Much of Sudan's revenue similarly
depends on oil transit fees. This dependence on oil and co-dependence on
each other was as tragically exemplified when South Sudan stopped oil
production in January 2012 in retaliation at Sudan confiscating oil citing
unpaid transit fees. Both countries' economies plummeted.
Oil production only restarted in April 2013 when a shaky compromise was
reached, and since then relations have remained precarious with both sides
continuing to accuse the other of supporting rebels in the disputed border
regions.
Given this perpetually volatile relationship between the two long-standing
nemeses, and the Sudans' economic co-dependence under the existing
arrangement, it is little wonder South Sudan is interested in finding
alternative ways of exploiting its oil wealth. However, if a new pipeline
was built that bypassed Sudan, South Sudan would have everything to win and
Sudan everything to lose. This is not something Sudan would allow to go
ahead easily and - given the already long-term low-level conflict simmering
in the border regions and the frequent barbed accusations thrown in each
direction between the Sudans - it is not difficult to imagine a significant
step-up in hostilities were a pipeline to go ahead.
Building the EAC
The proposed pipeline projects are just two of several initiatives being
undertaken by Kenya, Uganda and Rwanda as part of the East Africa Community
(EAC), which also comprises Burundi and Tanzania. The Community has already
established a Customs Union in 2005 and a Common Market in 2010, while it is
intending to produce a Monetary Union and, purportedly, eventually transform
into a Political Federation of East African States. Some of the other
projects to be implemented include establishing an EAC e-identity card,
boosting tourism, enhancing electricity generation and rehabilitating a
railway line between Kenya and Uganda into Rwanda.
Many of these projects might be successfully carried out and lead to
positive results. But for those outside the circle of collaboration, the
view is very different. There is a strong possibility that the two pipeline
projects could prove to be double-edged swords and re-inflame tensions
between hostile neighbours. Once again, oil could prove to be a curse rather
a blessing for East Africa.
Raluca Besliu is a freelance journalist focused on women's and children's
rights, refugee and human rights issues, and peace and post-conflict
reconstruction. She has written for various news sources including Digital
Journal and Politics in Spires. She graduated from the University of Oxford
with an Msc in Refugees and Forced Migration after studying international
affairs at Vassar College.
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Received on Mon Jul 15 2013 - 18:11:20 EDT