NAIROBI, Feb 20 (NNN-KBC) — Tullow Oil plans to invest over Ksh 300 billion in exploration activities and construction of an 800-kilometer crude oil pipeline.
The investment to be staggered in a three-year period will see the company spend Ksh 200 billion to sink 36 wells and Ksh 100 billion on the planned pipeline.
Petroleum Principal Secretary Andrew Kamau has said the country needs to triple its daily production to make the pipeline commercially viable.
Kenya discovered commercial oil reserves around the Lokichar basin in Turkana County seven years ago.
Currently, the basin is estimated to contain around 560 million barrels in crude oil reserves.
The government together with Tullow Oil embarked on a pilot project to truck oil from Lokichar to the Port of Mombasa in July last year and has since transported 80,000 barrels.
Tullow Oil says it will invest more than Ksh 200 billion in 36 oil fields in the Turkana region to make the planned 800 Km pipeline commercially viable.
Petroleum PS Kamau says the pipeline will be a joint venture between the government, French oil conglomerate Total and Africa Oil.
Tullow Oil Kenya Chief Martin Mbogo says the company expects commercial framework agreements from the government and deals over land acquisition for the planned 800-km pipeline and oilfield infrastructure before June this year.
Last year Tullow Oil invited bids for drilling 300 wells in the initial phase of production of the commodity.
The company says it will raise the funds through a mix of internal funding and investment from external financiers. — NNN-KBC