Kenya left smarting from pipeline debacle

Often viewed as the regional economic powerhouse, Kenya’s failure to seal the crude oil pipeline deal with Uganda has left its dominance hanging by a thread as personal and regional politics take centre stage.

When he appeared before a Senate committee on Wednesday, Energy Cabinet Secretary Charles Keter appeared to hint that Kenya was ready to take off the gloves and protect its regional interests.

“We have been bending over backwards to accommodate our brothers but we will reach a time when we begin looking at our interests first,” Mr Keter said.

The minister’s statement could spell doom to the “coalition of the willing”, largely made up of Kenya, Uganda and Rwanda, a group of East African Community states that has been co-operating to fast-track regional integration by eliminating strict requirements for work permits and movement of people across the borders, among other issues.

Tanzania has in the past been accused of being a stumbling block. 

Uganda, which is Kenya’s largest trading partner, opted to deal with Tanzania to transport its crude oil from Hoima to the port of Tanga despite earlier agreements signed between the governments of President Uhuru Kenyatta and his counterpart Yoweri Museveni.

THINGS NOT AS ROSY

The tone of the communique and the body language at the 13th Northern Corridor Integration Projects (NCIP) Summit last weekend in Kampala indicated that things were not as rosy as the Kenyan government wanted people to believe.

“On the crude oil, the summit agreed that two crude oil pipelines, one from Lokichar to Lamu and another from Hoima to Tanga, will be developed by Kenya and Uganda, respectively,” the joint communiqué read.

Comparing the Hoima-Lokichar-Lamu route to Hoima-Tanga route, President Museveni resorted to a Ugandan proverb to draw comparisons between Kenya and Tanzania. “If puppies are young, you don’t know which one will be a better hunter, so you feed all of them and when they grow you see which one emerges the best hunter,” he said.

Tanzania has apparently emerged the better hunter, leaving Kenya to go it alone in building the pipeline to carry crude oil from the Turkana oilfields, which was planned as part of the massive Lamu Port South Sudan Ethiopia Transport corridor.

Tanzania has further boosted its role in reaping from the regional oil resources by joining Kenya in securing shareholding in the Uganda oil refinery. In hindsight, Kenya appeared to have been blindly faithful to Uganda’s previous commitments on a joint pipeline.

ANGERED KENYATTA

The Uganda-Tanzania deal is said to have angered President Kenyatta, who is perceived to have a close relationship with President Museveni.

Kenya’s anger, sources say, was exacerbated by the manner the Ugandans took them for a ride, including forming a joint technical committee headed by their respective Energy ministers to re-evaluate the Hoima-Lokichar-Lamu and Hoima-Tanga route and come up with the least-cost option.

This followed President Museveni’s visit to Nairobi. However, it appears the reports by the joint team were never taken into consideration.

Things were made worse by incidents of diplomatic conspiracy. Last month, a delegation of senior Kenyan officials on a visit to Tanga, including Mr Keter, was detained at the Arusha airport by Tanzanian authorities while their Ugandan counterparts were allowed access into the port.

And on April 23, ahead of the heads of state arriving for the NCIP summit in Kampala, Mr Keter drove to a ministerial meeting scheduled for 11am only to be told that his Ugandan and Tanzanian counterparts had already met but would share the minutes with him. 

But the characterisation of Kenya being a loser in regional leadership is one conclusion Foreign Affairs Principal Secretary Monica Juma says is unfounded.

“Our regional leadership is an objective reality and emanates from a number of historical and current facts. This will, therefore, not be affected by a future investment decision of one item. Furthermore, the planning for our pipeline begun way before the Tanga corridor,” Dr Juma told the Sunday Nation.

NEW ECOMIC ORDER?

She brushed aside suggestions of a new economic order in the region, and said the so-called “coalition of the willing” will remain strong as it is concerned about other issues of regional integration beyond infrastructure.   

Prof David Kikaya, an international relations lecturer at the United States International University-Africa, argued that the loss of the pipeline deal does not augur well for Kenya’s economic powerhouse status within East Africa.

“The initial understanding on the pipeline would have enhanced Kenya’s status in the region, the continent and in the oil exporting world. Even though Kenya does not have the same amount of oil deposits as Uganda, it would have still been seen as a net exporter,” said Prof Kikaya, a former head of the Kenyan mission to the United Nations Habitat.

Besides, noted Prof Kikaya, the pipeline deal “would have been an extra glue” for the “coalition of the willing” which he admits has been upset.

“Kenya sealing the deal would have had a multiplier effect in terms of jobs and economic standing. It was realpolitik at play but Kenya banked on the benevolence of its neighbour and the benefits that would have accrued are no more,” he said.