By Jeff Kapembwa
Lusaka - Zambia and Angola have secured a staggering US$5 billion for the construction, in the next five years, of an oil pipeline connecting the two Southern African neighbours aimed at operationalising the Lobito Corridor.
Work is projected to start from the refinery of Lobito, situated in the Angola’s western end, to Zambia and is planned to be handled jointly by two companies, Baseli Balisel Resources (BBLR), a Zambian-based company, Angola’s Sonangol.
This was said by Zambian Ambassador to Angola, Lawrence Chalungumana, in a statement issued on the eve of his country’s independence and seen by The Southern Timesin Lusaka.
The project forms part of the bilateral agreement signed between the two countries as it will further culminate in the construction of roads and railways to connect other neighboring countries in the Southern African region and benefit the over 257 million people and bolster trade.
Bilateral relations between Angola and Zambia, sharing a 1,300 kilometres long border, have continued to grow in recent years. This is evidenced by yet to be finalised planned investment of an over US$350 million mobile service provider, Unitel in Zambia, before the close of the year after it finalises formalities.
A Permanent Joint Committee on Defence and Security of both countries met last year at which various matters of interest were discussed. A 32nd session is scheduled to be held before the end of this month.
Other high level meetings involving both government and private sector entrepreneurs have been held in recent years focusing on agriculture, oil, finance and economy, trade and provincial administration, said Chalungumana.
In June, Zambia hosted an oil and gas conference in Lusaka at which it sought to tap into reserves that have remained unexploited in collaboration with prospective investors. Last year, Zambian Minister of Energy, Mathew Nkhuwa, and Angolan Minister of Petroleum, Diamantino Azevedo, signed a Memorandum of Understanding on bilateral cooperation on trade in oil and gas worth US$5 billion.
Nkhuwa disclosed that Zambia spends an average US$1 billion per annum importing petroleum products. He was hopeful the agreement, once finalized, would help to reduce the cost of the commodity once Zambia and Angola finalise the pipeline project.
The Angolan minister, speaking at the same occasion, was optimistic the MoU with a desk value of US$5 billion, marked the first step in achieving his country’s goal to contribute to the economies of neighbouring countries like Zambia.
The MoU with Zambia is the gateway for Angolan companies to start implementing the trade in oil and gas between the two countries.Angola’s state-owned Sonangol, overseeing petroleum and natural gas production, will be in charge of the trade deals.
In a related development, Zambia and Tanzania resolved to build a US$1.5 billion refined products pipeline to transport petroleum between the two countries to defray import costs, according to Tanzania’s Energy Minister, Medard Kalemani.
Kalemani, in a presentation of his ministry’s 2019/20 budget, disclosed that the pipeline would run from the commercial capital Dar es Salaam to Zambia’s mining city of Ndola, covering a distance of about 1,349 kilometres.
Kalemani, could, however, not give a time frame when the project would kick off or financing details, apart from stating that next fiscal year, Tanzania and Zambia planned to complete a feasibility study although optimistic of reduced import costs.
“The project will reduce challenges in transporting petroleum products in the countries that use our ports to import fuel and open up business opportunities …” he said.
Kalemani said the pipeline would also have take-off points at Morogoro, Iringa, Njombe, Mbeya and Songwe regions on the Tanzanian side.
Zambia imports most of its petroleum requirements, mainly from the Middle East, through the port of Dar es Salaam in Tanzania.Tanzania and Zambia have a crude oil pipeline between them transporting oil to Zambia. It is refined at Indeni Oil Refinery for local use.