Uganda and Kenya have decided to construct an joint oil pipeline project linking the western Kenyan city of Eldoret and Kampala in August 2006, local press reported on Tuesday.

The joint coordinating commission was formed during the pre-bid conference for pre-qualified bidders in Kampala.

Watuwa Bwobi, director for energy in the Energy Ministry said at the conference that the bids would be submitted at the end of October this year. "The pipeline expected to be in operation by late 2007," he said.

The Kenyan and Ugandan governments will contribute 49 percent while the private sector's contribution will be 51 percent.

A total of 12 firms have pre-qualified for the bids.

The project, with a cost of 110 million US dollars, will provide a safer and more efficient method of transporting oil products to Uganda and export markets.

Meanwhile, Kenya Petroleum Company has announced that it will spend 32.5 million dollars in the next five years to upgrade its infrastructure to deliver oil efficiently to neighboring countries.

The company supplies oil to Uganda, Rwanda, Burundi, Sudan, Tanzania and the Democratic Republic of the Congo.

Source: Xinhua