UNCLAS BUJUMBURA 000337

SIPDIS

SIPDIS

DEPT FOR AF/C

E.O. 12958: N/A
TAGS: EAID EINV EMIN ENRG EPET PREL PBTS RW KE TZ UG BY

SUBJECT: CONSULTANT TO US TRADE DEVELOPMENT AGENCY VISITS BURUNDI TO
ASSESS OIL PIPELINE FEASABILITY



1. Summary. An energy consultant for the U.S. Trade and Development
Agency (USTDA) met May 2-3 with senior Government of Burundi (GOB)
officials and private energy officials to discuss a feasibility
study for a petroleum pipeline to Burundi. Burundian government
officials and private concerns responded enthusiastically to the
USTDA-funded study, and offered any necessary assistance. A workshop
to discuss the results of the initial study will take place in
Rwanda in September. If the study indicates that a pipeline is
economically viable, a more technically detailed feasibility study
will follow. End Summary.



2. ?ke Densert, an energy consultant for the US Trade and
Development Agency (USTDA) met with the Minister of Energy and
Mines, the Minister of and Commerce and Trade, and leading figures
in Burundi's private sector May 2-3 to asses a USTDA-funded economic
feasibility study of the construction of a petroleum products
pipeline from Kampala, Uganda, to Rwanda and Burundi. Econoff and
the Embassy's Econ assistant accompanied Mr. Densert in his
meetings. Mr. Densert relayed that the USTDA's focus in the study
is to asses potential petroleum product demand and transportation
costs for petroleum products for the next twenty years.


3. In all of the meetings, public officials and private
representatives responded enthusiastically to the prospect of a
petroleum pipeline to Burundi. The Minister of Commerce and Trade,
Donatien Nijimbere, immediately understood the importance to Burundi
of the creation of such a pipeline, and promised full cooperation
with the USTDA in the completion of the feasibility study.


4. Mr. Densert told the Ministers and private sector business
people that the pipeline, if constructed, would be an extension of a
light oil (gasoline, gas/oil, jet fuel and kerosene) pipeline from
Eldoret, Kenya, to Kampala, Uganda. Scheduled construction is to
begin in fall 2007. The USTDA anticipates that the pipeline will be
finished in late 2008/early 2009. Heavy fuel oil, he informed them,
would contaminate the pipeline; therefore, transport to Burundi by
tanker truck would continue for this commodity.


5. Mr. Densert indicated that, upon completion of the feasibility
study in September 2007, a workshop to discuss the results of the
study would be held in Rwanda. Participants from Burundi and the
other countries involved in the proposed pipeline will be encouraged
to offer input on the completed study. He suggested that the
Ministry of Energy and Mines, the Ministry of Commerce and Trade,
and private business concerns, recommend approximately five
participants from Burundi to attend the workshop, and offered to
investigate potential funding to facilitate their participation.
Mr. Densert said that a specific date for the workshop would be
determined as the feasibility study drew closer to completion, and
upon conclusion of the workshop, the USTDA will finalize the study
and issue a final report. If the initial study indicates that the
pipeline is economically viable, a more technical feasibility study
will follow.


6. Comment. In his parting observations, Mr. Densert recommended
training courses in the U.S. in the field of petroleum-product
supply and distribution for appropriate government officials.
Access to reliable energy, and increased expertise, will go far in
boosting Burundi's economy, and serve as a foundation for its
economic progress. End Comment.