Tullow Oil PLC (TLW.LN), China's Cnooc Ltd. (CEO) and French oil company Total SA (TOT) could invest up to $5 billion building pipelines that would form a regional oil export hub to transport crude discovered in Uganda and Kenya to world markets, Tullow said Wednesday.

The ambitious plans of Tullow and its partners underscore East Africa's potential to become a major new exporter of energy later this decade. On top of the oil resources found in Uganda and Kenya, their southern neighbors Tanzania and Mozambique are the site of major gas discoveries with significant export potential.

U.K.-listed Tullow, which reported a 66% surge in first-half net profit to $546.2 million Wednesday, said the three firms are, "currently studying potential routes and design for an export pipeline." The total cost of this is anticipated to be, "$2.5 billion to $5 billion, depending upon the route, design and throughput," it said.

The upper range of the cost estimate would involve building a regional hub to transport crude from Uganda and Kenya to be exported from Africa's east coast, Tullow said.

Tullow in February concluded a long-delayed deal to sell one-third stakes in three Ugandan exploration areas to both Cnooc and Total, paving the way for some $10 billion of investment in the country's nascent oil sector. The three firms are progressing efforts on pumping oil from the huge reserves discovered on the shores of Lake Albert. Early production is expected to start by 2013, with a major expansion phase in 2016.

Tullow said its plans for the export pipeline will also be influenced by a recent oil discovery in Kenya, where the Ngamia-1 well has so far delivered promising indications that the country holds similar crude reserves to its neighbor, Uganda.

Tullow will expand its Kenyan exploration in light of these recent developments. It had originally scheduled a single drilling rig to be in operation there until the end of the year, but will now commission another two to probe around 100 prospects in the country, said head of exploration, Angus McCoss.

An export pipeline is, "an integral part of the upstream development," in East Africa, said Tullow Chief Operating Officer Paul McDade.

"Cnooc and Total have a regional perspective, and we have to look at all options," said Mr. McDade, explaining that there was a wide range of options being considered. "The obvious route is through northern Kenya, with a spear to Lake Albert," said Mr. McDade.

Total also has oil interests in South Sudan, which neighbors Uganda and Kenya.

Costs for developing the pipeline are likely to be split three ways, given that each of the partners holds equity of a third in the Ugandan oil discoveries, Mr McDade said.

However, Tullow does not plan to invest in a 20,000 barrel-a-day refinery that the Ugandan government wants built to supply fuel to the local market. "We've always said we don't want to be involved in the midstream and the downstream," said Mr. McDade. "Cnooc and Total have technical skills here that they could use [to develop the refinery]."

Tullow shares were lower in early trade as the market reacted with disappointment to Tullow reducing its estimates for the amount of recoverable oil at its TEN project in Ghana. At 1516 GMT, Tullow shares were down 92 pence, or 6.7%, at 1278 pence.

Separately, Cnooc also widened its African portfolio Wednesday, albeit on the other side of the continent, by agreeing a deal with Royal Dutch Shell PLC (RDSB.LN) to take a 25% share in two exploration blocks off the coast of Gabon. The deal was agreed in parallel with two other pacts with Shell to jointly explore for oil in Chinese waters.