Total and Tullow Oil, the main stakeholders in the Turkana oil project, are in the process of selling their stakes in the Oil project. Tullow intends to dispose of its entire 50% ownership in the project while Total, which owns 25% of the project, is selling half of it.
Reliable sources have told Reuters that the sale could result in Tullow’s complete exit from the project even as uncertainty looms over the project’s launch date.
Commercial production of oil in Kenya is expected to begin in 2022. However, the exit of UK based Tullow Oil could scuttle the entire plan.
Oil exploration in the Northern part of Kenya has encoutered several hurdles; from local community unrest, to poor road infrastructure.
The two oil companies have contracted French bank Natixis to conduct the sale of Blocks 10 BA, 10 BB and 13T in the South Lokichar Basin.
As per Reuters, the value of the Turkana Oil project is estimated at $1.25 (KSh126 billion) to $2 billion (KSh202 billion). The fields produce 2000 oil barrels per day but are expected to produce 100,000 barrels per day when commercial oil production begins in 2022.
Kenya shipped its first 250,000 oil barrels in August 2019, in an early oil production scheme. The sale generated KSh2 billion.