(Ecofin Agency) - Uganda has said that the private company to be picked as the lead investor in the proposed $3.5 billion oil pipeline between the country and Tanzania could get up to 60% interest in the project.

Tanzania and Uganda intend to complete the construction of a crude oil pipeline by 2020 to transport crude from Uganda's oilfields in the Albertine rift basin and securing a partnership with a private company is important for the project.

“It (the stake) could be as far as 60 percent for the lead investor. And for us - Uganda and Tanzania - we would share the rest. So far we have 16 applications from companies,” Peter Lokeris (photo left), Uganda's minister of state for mineral development said not disclosing the names of the firms that had applied.

Uganda also plans to construct a $2.5 billion refinery, in order to generate more from its oil resources, which were discovered in 2006.

Disputes over taxes and the capability of the refinery have hindered commercial production, which is now projected to start between 2019 and 2020.

The Energy ministry in July, said it had finalized talks on the refinery with a group spearheaded by Russia's Rostec Global after it made more demands to a deal signed in May.

The ministry added then, that it had started talks on the refinery with another bidder, a consortium led by South Korea's SK Engineering.

“We have opened another round of discussion. There are 21 companies so far. Our discussions are bilateral,” Lokeris told Reuters.

Anita Fatunji