27 November 2012

Kenya: Tullow Strikes Second Oil Deposits in Turkana

Photo: Tullow Oil/Facebook
Tullow's first onshore exploration well in Kenya, Ngamia-1, discovered more than 100 metres of net oil pay.

Fresh oil deposits have been discovered in Lokichar basin, Turkana County, Tullow Oil company announced yesterday. The company said it has discovered 30 metres of vertical oil depth with oil presence at the Twiga1 well, just 20 kilometres north of Ngamia1 well.

If this section is confirmed to contain extractable oil, gas or both, Twiga1 discovery could become the largest discovery so far. "This is a new play in Kenya that needs to be evaluated further," said and Anne Kabugi, Tullow Oil Kenya corporate affairs advisor. "For the Twiga South-1 case, it is still very early days and more tests need to be done to ascertain the extent of the fractures and establish if the oil can actually flow through.

A series of flow tests will now be conducted on the well over the next 4-8 weeks. Following completion of the testing program, the rig will move back to flow test the Ngamia-1 well for appraisal drilling?

"This immediate follow up on discovery reaffirms the considerable prospectivity of the Lokichar Basin," said Tullow Oil Exploration director Angus McCoss.

Twiga1 is Tullow's second exploration well in Kenya. The executive director of Petroleum Institute of East Africa Wanjiku Myanyara said the discovery makes it more urgent for Kenya to prepare its capacity to reap the benefits when production begins.

"We must urgently equip people with the right skills for the oil industry jobs, make proper policies, position service industry including banks to participate in it, and encourage entrepreneurs to establish related businesses to tap into the emerging oil production industry," said Manyara

She said the government must also fast rack the infrastructure that may be needed to support oil production specifically roads and rail transport corridors, now that financiers may be more enthusiastic to come on board in anticipation of oil and gas production and local economic boom.

The chairman of Kenya Private Sector Association Patrick Obath said the new discovery positions Kenya as a better investment destination and therefore explorers will find it easier to access capital.

"It makes oil exploration in Kenya very enticing because the oil encounters are in places it was never it was never expected to be meaning explorers may also have to review their models," said Obath.

Drilling at Paipai-1 well in Block 10A is going on as planned and results are expected to be released by the end of the year. More than 20 companies are involved in the oil search in the country eight of them onshore, including Africa Oil and Tullow who have significant acreage.

Kenya has licensed 45 of its 46 oil exploration blocks and may soon sign new players in parts of blocks ceded by existing explorers as the law requires them to give up a quarter of license territory after an agreed period of time.

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