13 February 2013

Kenya: Oil Find May Be Commercially Viable

Nairobi — Kenya is moving closer to being an oil producing country after the British based exploration firm Tullow Oil Plc announced on Wednesday that the fourth test on oil deposits at Twiga South-1 well has for the first time showed real signs of being commercially viable.

The four tests on the deposits were carried out between January and February this year.

In a statement, Tullow said the fifth and final flow test is ongoing and it is anticipated that the zone will produce over 500 barrel of oil per day (bopd) taking the total combined rate flow to 2,850 bopd for the well.

"These tests provide the first potentially commercial flow rates achieved in Kenya and provide real encouragement even for the Ngamia test. With the conclusion of the Twiga South-1 testing programme, the rig will move to Ngamia-1A to re-enter the well and perform four flow tests. These tests are expected to deliver rates similar to Twiga South-1," the oil firm said in a statement.

Twiga South-1 well is about 30km west of Ngamia-1 well where Tullow struck oil earlier in 2012.

The firm said it is on the other hand still conducting a series of tests at Ngamia 1 well.

In 2013, Tullow plans to drill up to 11 exploration and appraisal wells and carry out up to five well tests to de-risk further basins and to understand the potential scale of the South Lokichar discoveries.

Whilst both the Ngamia and Twiga South discoveries have exceeded expectations and substantially de-risked further prospects in the South Lokichar Basin, the firm said it will require considerably more exploration and appraisal activity to be completed before the commercial threshold for the basin is achieved.

The company is also going on with the drilling of another well, Paipai-1, which has been drilled up to 4,255 metres so far in northern Kenya's Marsabit County on Block 10 A.

But Tullow says it has not been able to obtain samples conventionally there, due to difficult hole conditions.

Tullow's acreage in Kenya and Ethiopia includes Blocks 10A, 10BA, 10BB, 12A, 12B and 13T in Kenya and the South Omo Block in Ethiopia which together cover around 100,000 sq km.

The firm has been licensed to operate all seven of these blocks and has a 50 percent interest in six of them.

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