UPDATE 1-Uganda, Tanzania plan oil pipeline

(Adds Tanzanian statement)
By Elias Biryabarema
KAMPALA, March 2 (Reuters) - Uganda and Tanzania are
planning to build a pipeline from Ugandan oil fields to the
Tanzanian coast in a move that could strike a blow to Kenyan
pipeline plans.
Statements issued after Ugandan President Yoweri Museveni
and his Tanzanian counterpart John Magufuli met on Tuesday did
not mention the fate of the Kenyan oil export pipeline plan.
Uganda, which has yet to start oil production, raised the
possibility of a Tanzanian pipeline route last year.
France's Total TOTF.PA , one of the oil firms developing
Uganda's fields, had raised security concerns about the Kenyan
route. A Kenyan pipeline could run near Somalia, from where
militants have launched attacks on Kenya.
But industry officials have also said connecting Kenyan
fields, which are also yet to start production, with those in
Uganda would make the pipeline project cheaper as costs would be
shared.
"The two countries are planning to build an oil pipeline
between Tanga (in Tanzania) and Uganda covering a distance of
1,120 km," the Ugandan presidency said in its statement.
"Magufuli said this is projected to employ 15,000 people."
Tanzania, which also has large offshore natural gas
reserves, issued a similar statement.
Uganda's Museveni has strong ties with Tanzania as he
launched the rebellion that brought him to power in 1986 from
Tanzanian soil.
Uganda's statement quoted Magufuli saying that Uganda's
decision was "reciprocating" Tanzania's past role.
Museveni and Kenyan President Uhuru Kenyatta had made a
joint call in August to implement a pipeline via Kenya's
northern region "without further delay".
But that statement was followed by other Ugandan comments
saying the Tanzanian route was being explored as a possibility.
Resolving the pipeline route is vital in helping oil firms
involved in Uganda and Kenya make a final investment decision on
developing oil fields.
Production start dates have repeatedly been postponed,
partly over pipeline considerations but also because of low oil
prices.
Other investors in Uganda include China's CNOOC 0883.HK
and Britain's Tullow Oil TLW.L . Tullow is also working in
Kenya.