Uganda: oil revenue possible alternative to Chinese cash for railway
Uganda could rely on income from future oil exports to finance an $8-billion railway if funding talks with China fail to bear fruit, its president said.
Yoweri Museveni confirmed that Uganda had started negotiations with China on building the line that would link to Kenya, speeding up freight transport in the region.
“But if they don’t (offer financing), we shall fund it ourselves,” Museveni told Reuters on Monday .
“Remember we have our oil, which we shall start harvesting in 2017, and that money will deal with these projects – railway and electricity … China or no China, we shall build that railway.”
The new line would run from the Kenyan border to Kampala, then north to South Sudan and west to the oil fields. The existing line has suffered from years of neglect. Most freight in Uganda goes by road.
Uganda was deemed to have commercially viable quantities of oil when recoverable reserves reached a threshold of 800-million barrels. That figure has now reached 1.4-billion barrels and the discovery of oil in Kenya has made building a pipeline across both states more viable.
Uganda has signed up to a proposal with Kenya to build a pipeline running to a planned oil terminal on the northern Kenyan coast.