Markets & Finance

Lobby supports plan to bring locals on board in exploration

RIG

An oil rig at Ngamia 1 in Turkana County. PHOTO | FILE

The Kenya Oil and Gas Association (KOGA) has thrown its weight behind the proposed regulations meant to reserve a share of exploration business for locals.

Contractors and sub-contractors in the petroleum sector are obliged to ensure businesses owned by members of the community where they are exploring are contracted and also have a shareholding in the project.

The lobby chairman Donald Mahaga said the association had examined the draft regulations and would be engaging with the Energy ministry with the view of benchmarking, enhancing cooperation and capacity.

“You need to build capacity to drive local content in the industry,” said Mr Mahaga, who is also the general-manager of Africa Oil Kenya BV.

He said local content is good for both multinationals and the country as local capacity can translate into affordable and convenient exploration and production.

READ: Firms told to hire more locals in mining sector

Some of the notable running contracts include vehicle purchase schemes by Tullow Oil where communities invest in vehicles hired out to Tullow for day to day operations.

Seismic acquisitions

Oil and Energy Services CEO, Mwendia Nyaga, said whereas individual professional capacity could be developed in a few years, the bigger challenge was in equipping local service and goods providers in areas such as seismic acquisitions, drilling, research and development, among other core services.

“We have limited capacity but it is nobody’s fault since we couldn’t have invested in something we didn’t know we have,” said Mr Mwendia.