Toyota Tshusho Engineering Corporation will design and carry out a feasibility study for the construction of a crude pipeline between Hoima to the Kenyan coast after the company won the tender.
The company that signed the contract last week in Kampala submitted a design that would see the crude oil pipeline follow the Hoima-Lokichar-Lamu route in a project estimated to cost $4 billion.
Toyota Tshusho beat other companies including three designs that start from Hoima are by a consortium consisting of Tullow/Total/ CNOOC, while the rest are by Total (Hoima-Eldoret-Lamu/Mombasa) and another by the Lamu Port Southern Sudan-Ethiopia Transport (LAPSSET) Corridor which starts from Juba in Southern Sudan through Lokichar and Moyale to the Lamu port.
“The governments of Kenya, Uganda and Rwanda have signed a contract with Toyota Tsusho of Japan for the feasibility design and preliminary engineering design study for the Hoima-Lokichar up to the Kenyan coastline crude oil pipeline,” Kenya’s Energy and Petroleum Principal Secretary Joseph Njoroge is quoted by the Business Daily.
Following the awarding of the tender focus now shifts to financing with the cost initially estimated at $3 billion expected to shoot by 25 percent should the design incorporate a heated pipeline as well as further expenses expected from the terrain between Hoima and Lamu.
Toyota Tshusho is expected to complete the study in five months with the pipeline set to be completed between 2017 and 2018 in time for both Kenya and Uganda to start the exportation of crude oil.
According to a communiqué from a heads of state summit in Rwanda this June the five governments that include Kenya, Uganda, Rwanda, South Sudan and Ethiopia will decide on their financing arrangement model by February next year.[twitter-follow screen_name=’oilnewskenya’]