Uganda pipeline plan halted after Tullow, Total, CNOOC deal collapsed

[Tom Kirkman + 8,860]

Another one bites the dust 
Another one bites the dust 
And another one gone, and another one gone 
Another one bites the dust… 

The "Keep Oil & Gas In The Ground Forever" crowd might be happy about this news, if they actually heard about it.

But since this cancelled oil pipeline was in Africa and not the U.S. they may not actually care much.  Because apparently U.S. oil is bad but African oil, not so much.  Go figure.

 

Anyway, since the article website is a morass of tracking cookies and obtrusive popups, I'm posting the article in full:

Uganda pipeline plan halted after Tullow, Total, CNOOC deal collapsed

Plans to build a pipeline in Uganda to export oil have been suspended after a deal among UK company Tullow Oil, French supermajor Total and state-owned China National Offshore Oil Corp. (CNOOC) was terminated.

Activities connected to the East African Crude Oil Pipeline were suspended as there was uncertainty in terms of who will invest in the development, which was meant to have a similar shareholding structure like the oil fields.

The 900-mile pipeline was expected to cost $3.5 billion.

Total declined to comment.

Infrastructure woes

Lack of infrastructure hinders development of Uganda’s oil reserves discovered 13 years ago, Kallanish Energy learns.

The deal between Tullow, Total and CNOOC was ended as the companies and the local government didn’t agree on the transaction tax.

Under the sales and purchase agreement, Total was going to acquire 21.57% of Tullow’s 33.33% interest in the Lake Albert licenses. CNOOC exercised its right to pre-empt 50% of the transaction. As a result, Total and CNOOC would have each increased their interest to 44.1% while Tullow would have kept 11.8%.

The Lake Albert project is estimated to hold more than 1.5 billion barrels of discovered resources and produce 230,000 barrels per day at peak production. The final investment decision was initially targeted for end of 2019 but is likely to be delayed.