Uganda’s Insurance Regulatory Authority (IRA) Chief Executive Officer, Ibrahim Kaddunabbi Lubega, reveals that the process of insuring the East African Crude Oil Pipeline (EACOP) is now done, Nile Post reports.
Kaddunabbbi says a consortium made of local insurance companies has pooled resources and capacity to insure the $4bn EACOP, the 1, 444km facility that will export Uganda’s oil that was discovered in western Uganda. The said consortium is called Insurance Consortium for Oil & Gas, Uganda (ICOGU).
“We approved the oil and gas consortium after various players licenced dedicated resources to the creation of the insurance consortium that created the capacity of the consortium.
“When time came to underwrite the pipeline, it is the consortium (ICOGU) that underwrote and submitted to us to approve whether they have capacity or whether what they are doing is the correct thing. “I can confirm that EACOP is fully insured to the extent of the information they submitted. For the policies that they came for have been approved but there are many other policies they need to take up,”Kaddunabbi told journalists on Thursday.
TotalEnergies, the lead investor of the EACOP, along with CNOOC Uganda, Uganda National Oil Company (government of Uganda) and Tanzania Petroleum Development Corporation (TPDC) is struggling to find a suitable bank to finance the project with many able banks pulling out because of environment and climate change concerns.
EACOP has also struggled to find the right insurance companies to protect the project against insurable risks. The coming on board of local insurance companies comes as a relief even though the insurance industry regulator didn’t give details of the risks covered.