South Lokichar’s Final Investment Decision to be out by August – Tullow Oil

The final investment decision for the early oil pilot scheme in Kenya’s oil rich South Lokichar basin is expected to be out either between the months of June and July according to Tullow Oil’s director of government, public affairs and communications Anthony Mwangi at the ongoing 2nd Turkana Oil and Gas Conference in Lodwar.

The explorer then expects early oil at a rate of 2,000 barrels of oil a day through road transport to commence in July 2017 from where it shall be stored for up to 8 months as to when adequate export amounts of over 600,000 barrels shall be achieved.

Already the company says it holds about 70,000 barrels at the Ngamia and Amosing fields that was extracted during the extensive well testing programme.

The early oil according to Mwangi will enable the country acquire knowledge on how to access markets with factors such as refineries to be contracted to refine the waxy oil yet to be identified.

“Since it is clear that the Mombasa refinery cannot refine our crude oil we need to identify specialized refineries in East Asia such as Malasyia and India to handle this oil before we start exporting 100,000 barrels a day,” Mwangi said.

This will be ongoing as work on the pipeline continues with efforts to identify the project designer expected to conclude in the next fortnight.

To date field development studies ongoing as well as the early oil pilot scheme and Expression of Interest on pipeline.

The environmental impact assessment is also to be carried out  with the International Finance Corporation (IFC) coming in as a joint venture partner with the work surely to be carried out as per World Bank standards,” says commissioner for petroleum Martin Heya.

The pipeline to be heated to 80 degrees will run underground from the Lokichar oilfields to the Kenyan coast before being transported for loading using an 8 kilometer underground pipeline offshore.

On social empowerment Tullow Oil says it is sponsoring 60 students to the Lokichar Polytechnic who will learn various skills including welding expected to employ up to 2000 works during the pipeline project. To date Kenya has 4 certified welders a majority of whom are past the age of 50 years.

“Developing capacity will enable the country have the first mover advantage which will enable Kenya export requisite skills to the region,” Mwangi adds

Tullow Oil estimates that the investment in the oil and gas sector in the Eastern Africa region could reach $100 billion in the next five years providing numerous employment opportunities for skilled residents.

To date Tullow Oil estimates to have spent about $1.5Billion used so far in its activities that including 31 wells exploration and appraisal wells, training and capacity building a majority of which is recoverable. as per the latest estimates Kenya has 750 million barrels of recoverable oil.

Cabinet Secretary for Energy and Petroleum Charles Keter is expected to attend tomorrow.