What Next for Kenya’s Prospects as a Crude Oil Exporter? 

Tullow Oil PLC and its partners are seeking strategic partners for the next phase of its Kenya project aimed at ensuring its viability.

The Kenyan Government, Tullow Oil, Total and Africa Oil Corp Early Oil Pilot Scheme (EOPS) for Kenya’s contract has expired after two years.

Tullow Executive Vice President, Mark Macfarlane says the pre-commercial program has served its purpose of providing technical data, logistical, operational experience, and training ahead of a potential full field development (FFD) program for project oil Kenya.

Project Oil Kenya was described as the largest-ever private sector investment in the country and a major step forward towards delivering FID for the project.

“The Early Oil Pilot Scheme has provided important lessons for the planning and execution of the Full Field Development phase of Project Oil Kenya,” noted MacFarlane.

“By producing, transporting, storing and exporting crude oil from Northern Kenya, the pilot scheme has provided proof of concept for oil production in Kenya. The first export of crude oil from East Africa in 2019 was a historic achievement and clearly demonstrated the potential of Project Oil Kenya on world markets.”

In June 2018, Kenya flagged off trucks loaded with crude oil from Ngamia 8, in the Turkana oil fields as part of the Early Oil Pilot Scheme.

During the period, Kenya concluded the first deal with 200,000 barrels at a price of KSh1.2 billion sold to China National Chemical Corporation (ChemChina).

In May, Tullow issued a force majeure to the Ministry of Petroleum as a result of the Covid-19 pandemic.

“Declaration of force majeure allows time for an improvement in the operating environment and for the joint venture partners, to discuss with the government of Kenya the best way forward for this strategic project,” the African Oil Corporation, a partner in Project Oil Kenya told its shareholders on May 15.