* Kenya wants pipeline to run through its territory
* Oil companies at odds over which is best route
* Total concerned by security of Kenyan route
* Tullow says Kenyan pipeline cheapest for Uganda
By Fumbuka Ng'wanakilala
DAR ES SALAAM, March 14 France's Total
has set aside $4 billion to build a pipeline from Ugandan
oilfields to the Tanzanian coast and Tanzania wants the
three-year construction timetable shortened, Tanzania's
presidency said in a statement on Monday.
The comments raise the stakes in a competition to secure the
pipeline with neighbouring Kenya, which wants Ugandan oil to be
exported across its territory and wants the pipeline to link up
with Kenyan oilfields.
Neither Ugandan nor Kenyan oilfields have started commercial
production. Determining the pipeline route is vital in helping
oil firms reach a final investment decision.
Britain's Tullow Oil, which is operating in Uganda
and Kenya, favours the Kenyan route, saying it is cheaper as
costs will be shared by more operators. Total, which operates
only in Uganda, favours Tanzania.
Total has voiced concerns about security for the Kenyan
route, with some sections likely to run close to the border with
Somalia from where militants have launched attacks on Kenya.
President John Magufuli, who built a reputation for driving
construction projects through swiftly when works minister before
elected president last year, urged officials to shorten the
three-year construction timetable, the statement said.
Total regional executive Javier Rielo told Magufuli "that
his company expected to invest close to $4 billion for the
project and that the funds had already been set aside", said the
statement, issued after talks between them.
"Tullow is clear that synergies from a joint pipeline mean
that the lowest-cost option remains a route that links Uganda
and Kenya's oil resources," Tullow said in a statement last
Kenyan officials say negotiations on the route are
continuing. One industry source said pumping crude through Kenya
would cost Uganda $12 a barrel, compared with $15 a barrel via
Total said its own studies showed Tanzania was cheaper.
"All the routes have been studied thoroughly and the
conclusion is clear that the route from Hoima to Tanga is the
least-cost route and the most reliable of all routes," a Total
source told Reuters.
(Additional reporting by Elias Biryabarema in Kampala; Writing
by Edmund Blair; Editing by George Obulutsa and Dale Hudson)