When East African Crude Oil Pipeline (Eacop), also known as the Uganda-Tanzania pipeline, finally starts running, officials in both countries could breathe a sigh of relief for surmounting a perennial challenge.

In this region, well-intended projects have often fallen victim to distractions -- political, financial or environmental.

Eacop is currently in the pre-commissioning phase in both countries, with the first components and systems of the mega project undergoing hydrostatic testing in the first quarter of 2026.

The 1443km pipeline is at 84 percent completion, marking a significant milestone, considering that when construction began in 2023 only $300 million had been raised, out of the required $3 billion for the project’s debt funding.

Initially, the project’s $5 billion construction budget was intended to be financed through a 60-40 percent debt-equity blend. But it faced financing headwinds when major lenders and insurers withdrew due to pressure from environmentalists and human rights groups.

Last year, Uganda revised its timelines for commercial production and oil export to July 2026 after it became apparent that construction of Eacop was more than 12 months behind schedule, stymied by the project’s struggles to secure debt financing and the owners being stretched by cash calls beyond their equity share.

Eacop is owned by TotalEnergies (62 percent), Uganda National Oil Company and Tanzania Petroleum Development Corporation (15 percent each), while Cnooc holds an 8 percent stake.

TotalEnergies issued bonds worth $6.62 billion with European and north American lenders last year, with some of the proceeds used to close Eacop financing as sponsor’s debt.

As a shared pipeline, the Uganda-Tanzania pipeline holds geopolitical significance for the region, amid talk of a regional mega refinery in Tanga to be built by Nigerian industrialist Aliko Dangote in collaboration with the East African Community (EAC) partner states.

The planned facility makes Eacop a strategic infrastructure for East Africa, anchoring transportation of crude from Uganda, South Sudan and the Democratic Republic of Congo to the refining plant.

The proposed refinery in Tanga, announced at The Africa We Build Summit in Nairobi last month has the backing of Kenya’s President William Ruto, and, reportedly, his Ugandan counterpart Yoweri Museveni. Both presidents were in a panel session with Mr Dangote and floated the idea of East African countries co-owning the facility.

But the joint refinery in Tanga starts yet another period of anticipation, and suspicions, like other regional integration projects. When Dr Ruto first made the revelation, Tanzanians, perhaps shocked, did not comment and the Ugandan leader too didn’t confirm or deny the ambition.

This week, while Dr Ruto was on a state visit to Tanzania, his host Samia Suluhu Hassan voiced her ignorance about the proposed project and her co-patriots’ discomfort with it.

Though subtle in tone, Mr Samia publicly questioned Dr Ruto’s announcement of the Tanga project plan without her government’s knowledge and demanded that he explains it, catching Dr Ruto off guard.“While we were speaking, I pressed Dr Ruto and asked him: you went ahead and announced a refinery in Tanga - why was I not aware? He will explain, himself, why he made that announcement,” President Samia said.

Dr Ruto took the opportunity to sell the proposal, explaining that it was not a unilateral decision but part of wider regional discussions on industrialisation with President Museveni on the use of local resources to develop the region.“Allow me to explain our discussion on Tanga as a place of refinery. I have been informed that my decision to announce the building of a refinery in Tanga has not sat well with you (Tanzanians). If I knew, I would have announced that the refinery would be built in Mombasa,” Dr Ruto said.

Dr Ruto’s political rivals back home latched on the gaffe to criticise his leadership style.

But Uganda too is curious. It had envisioned a $4 billion 60,000 barrels-per-day Kabaale refinery a decade ago. The refinery, with feedstock from Uganda’s own oilfields in the Albertine Graben, was announced with a lot of promise as a facility that would serve the regional market with refined petroleum products, and significantly, it would be co-owned by the governments of Uganda, Kenya, Tanzania and Rwanda.

But shifting political and economic interests by Uganda’s neighbours left Kampala in the lurch, with private investors struggling with financing hurdles.

Indeed this region has often planned projects depending on political ties. This week, Rwanda and Tanzania agreed to advance a $2.5 billion standard gauge railway project connecting the port of Dar es Salaam to Kigali through Isaka, with Presidents Samia and Paul Kagame pledging closer cooperation on transport, energy and trade during high-level talks in Dar on May 3.

The electrified railway is designed to cut transport costs, ease freight movement from Dar es Salaam and improve regional connectivity for landlocked Rwanda.

The port of Dar es Salaam is one example of many places vital to our economy,” said President Kagame.“At this time of political uncertainty, our region must remain focused and united around a shared vision for prosperity and cooperation.”There had been some cold aura between them, especially after Kigali didn’t comment publicly on the re-election of Samia last year, in polls that were accompanied by deadly violence. Officially, some 518 people were killed in the chaos.

This week, President Kagame spoke of region-wide relations as key for integration.“We have a responsibility to our citizens to ensure we are developing and strengthening relationship between our two countries and the rest of the EAC partner states,”A few years ago, Rwanda had been one of the Coalition of the Willing (CoW) trio with Kenya and Uganda, isolating Tanzania. They initially planned to build the SGR from Mombasa to Kigali. Somewhere along the way, Rwanda-Uganda relations broke, leading to a three-year border closure, before they warmed up again. Overall, the EAC is navigating a critical phase of expansion and integration, facing significant financial, political, and operational hurdles that threaten its progress.

Recently, the EAC partner states set a June 30, 2026 deadline to eliminate all remaining non-tariff barriers (NTBs), aiming to significantly deepen regional integration by that date.

Presidents Ruto and Samia have even set a specific, stricter deadline of May 31, 2026 to resolve all bilateral NTBs, aiming for faster integration between the two economies. One such barrier to remove is the cost of roaming.

Dr Ruto said this week, the region must consider calls into each other as ‘local’ under the EAC One Network Area (ONA) arrangement. Not every member has bought the idea, seeing taxes on calls as an important source of revenue.“For far too long, relations among neighbouring countries have been shaped by competition, suspicion and rivalry, forces that have fragmented our markets, weakened our voice and constrained our collective progress,” said Dr Ruto during his address to the Tanzania Parliament on Tuesday.

He attributed the differences between Kenya and Tanzania to mistrust, poverty and lack of job opportunities reiterating that the two nations were not enemies.

Kenya and Tanzania signed eight bilateral agreements which set a target of Ksh130 billion (about $1 billion) in new trade and Ksh65 billion ($500 million) in fresh cross-border investments deals. And they spoke of the superhighway between Malindi in Kenya and Bagamoyo in Tanzania. It has dragged beyond initial deadline of completion.

One question has been whether these projects improve or weaken state sovereignty and revenue sources.“It could be a challenge to resolve all the NTBs in less than two months, considering the extensive consultative requirements necessary to achieve this,” said Ken Gichinga, lead economist at Mentoria Economics.

Despite a 15 percent intra-EAC trade in 2024/25, persistent NTBs—including administrative delays, restrictive licensing, and product standards disputes (notably in dairy)—still increase costs and limit regional trade.

Persistent disputes, such as Kenya-Uganda dairy trade, Tanzania-Kenya excise duty, South Sudan’s Nimule border standoff and corruption in the Democratic Republic of Congo continue to disrupt trade flows.

Suspicion dominates relations between DRC and Rwanda over the war in eastern Congo, where M23, a Kinyarwanda-speaking rebel group, holds large swathes of mineral-rich territory.

Overall, the cost implications have also hampered implementation. When the SGR plan came up, the original idea among the CoW was to jointly build it.

Kenya built part of it to Naivasha and has struggled with funding to extend it while Uganda finally landed a Turkish contractor Yapi Merkezi, who is embroiled in corruption allegations back home, with officials in Kampala fearing that it might cause delays. Yapi is also being considered by Kenya to help electrify its SGR as it builds to connect with Uganda’s at the Malaba border.

South Sudan, distracted with insecurity and political crisis, hasn’t committed to the project, while Ethiopia is currently mostly focused on Djibouti port. Lapsset was to include the port, a highway, a railway, airports, and an oil pipeline.

Interests seem to have shifted as these countries, except South Sudan, have changed leaderships.

This week, the Lamu port managers were upbeat about its business prospects coming from the fallout in the Middle East crisis, which has pushed cargo deliveries to the facility.

Port general manager Abdulaziz Mzee said the port this week handled transit cargo to Burundi, the first-ever, demonstrating the growing confidence in its infrastructure and the emerging transport corridor linking Kenya to its landlocked neighbours.“This arrival proves Lamu was not built as an afterthought. This is historic as the port can handle transit containers destined to other neighbouring countries smoothly,” Mr Mzee said.

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