Tullow Oil’s License In Kenya Extended To End of 2021

Tullow Oil’s license for oil exploration in blocks 10BB and 13  in the South Lokichar basin scheme has been extended until 2021 despite the numerous financial challenges that the company has been going through. At one time, it had threatened to shut down operations.

In a statement, the British oil and gas exploration company said the license extension will allow its joint venture partners to re-assess Project Oil Kenya, in a venture that still has not seen Kenya reaping the benefits since the first discovery.

The partners include Total and Africa Oil.  They will work closely with the government on land and water agreements to gain the approval of the environmental and social impact assessments and finalizing the commercial framework for the project.

“I would like to thank the Government of Kenya for granting this extension which the joint venture partners will use to fully re-assess the development concept for this important project,” said Tullow Oil Plc chief executive, Rahul Dhir.

Petroleum Exploration in Kenya began in the 1950s within the Lamu Basin. … An estimate of over 4 billion barrels of crude oil reserves have been encountered in the Lokichar sub-basin by Tullow Plc and its partners, with recovery oil estimated to be 750 million barrels.

“On Kenya development, we are confident, particularly in light of the license extension discussion, allows us the time to complete the redesign work. We are continuing to work with the Government of Kenya is seeking the much-needed fiscal package, as per the agreed Heads of Terms, to deliver an investable project and an FDP by end 2021,” added Mr. Dhir.

Kenya’s Turkana oil reserves, discovered in 2012, are estimated at 560mn bl. Tullow owns a 50pc stake in the project, while its partners, Canada’s Africa Oil Corp and Total, each hold 25pc. Combined, they have invested $2bn.

Turkana is in Kenya’s remote, undeveloped interior, with the region’s people mostly engaged in pastoral farming. The oil will be transported from the 433-hectare oil production and processing facility to Lamu port in northern Kenya via an 820km pipeline.