Tullow is working with partners Africa Oil and A.P. Moller-Maersk to develop finds in the South Lokichar Basin in northwest Kenya. PHOTO | FILE
Britain explorer Tullow Oil said Wednesday it had found oil traces in Kerio Valley, opening up a second basin for development in the country after the Turkana finds.
The firm reported finds within a depth of 700 metres while drilling and further exploration will be needed to establish the existence of oil deposits.
Kenya and neighbouring Uganda have both made oil finds that are yet to commercialised as the East Africa region looks to develop a joint pipeline to evacuate the crude.
“The Cheptuket-1 well in Block 12A, Northern Kenya has encountered good oil shows,” Tullow said in a statement about the new find.
“The strong oil shows encountered in Cheptuket-1 indicate the presence of an active petroleum system with significant oil generation. Post-well analysis is in progress ahead of defining the future exploration programme in the basin,” The UK firm said.
Low oil prices have prompted international oil firms to reduce spending on exploration and development.
Prospects for export appear bleak lately as crude prices tumble in the global market. Prices have dropped from $73 per barrel at the beginning of in 2015 to $27 this year.
Energy and Petroleum Cabinet Secretary Charles Keter told a news conference: “The basin is good, they have encountered good oil shows.” He, however, did not elaborate.
Tullow is working with partners Africa Oil and A.P. Moller-Maersk to develop finds in the South Lokichar Basin in northwest Kenya, where recoverable reserves have been put at an estimated 600 million barrels.
Kenya is considering moving its crude oil to Mombasa by road and railway as President Uhuru Kenyatta’s administration races to hit the export markets before the General Elections set for August next year.
The Energy ministry has offered Rift Valley Railways (RVR) the contract to move the oil over a distance of more than 800 kilometres from Eldoret to the Kipevu-based Kenya Petroleum Refineries (KPR) from as early as February next year.
By choosing trucks and train, Mr Kenyatta appears determined to sidestep bureaucracy involved in constructing a joint pipeline with Uganda in effort to beat its tight timelines.
The neighbouring country, which aims to start crude production at least by 2018, recently signed an agreement with Tanzania to explore the possibility of building a crude oil pipeline between the two countries.
The move put in serious doubts efforts to have the line pass through Kenya.
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