The Star (Nairobi)

14 February 2013

Kenya: Tullow Finds More Oil in Turkana

TULLOW Oil yesterday released a set of well test results on Wednesday that it said could lead to Kenya's first commercial production.

Tullow said the Twiga South-1 exploration well in Turkana is likely to be profitable after tests showed the "first potentially commercial flow rates achieved in Kenya."

Four flow tests were carried out on Twiga South-1 in January and early February and a fifth test is ongoing, predicting a total combined flow rate of over 2,850 barrels of oil per day, said Tullow.

"There will be more focus on Kenya as a potential oil producing country," Energy ministry PS Patrick Nyoike told Reuters.

Five of Tullow's oil blocks are within a similar basin in the Rift Valley to the Lake Albert Rift Basin in Uganda where over billion barrels of oil deposits have been discovered and the southeast extension of the geologically older Sudan Rift Basins trend where oil is already being extracted.

Kenya will get the result of the Paipai-1 well later this month, according to Tullow Oil's 2012 financial results released yesterday.

Paipai-1 has been drilled to a total depth of 4,255 metres, deeper than the planned 4,112 metres and has encountered light hydrocarbon.

"We have been unable to obtain samples conventionally due to difficult hole conditions," said Tullow Oil chief executive Aidan Heavey.

The report said the drill at Paipai will be moved to Block 10BB to start drilling the Etuko-1 well in the Lokichar basin where Ngamia-1A well which recorded 100 meters of net oil pay is located. The drilling is programmed to start in the second quarter of 2013.

Etuko-1 Papai will be the fourth well drilled by Tullow since its drilling programme was rolled out with Ngamia-1 well in January last year.

In November 2012, the Tullow announced that the Twiga-1 well had encountered 30 metres of net oil pay and an additional tight reservoir rock section with hydrocarbon shows over a total gross interval of 796 metres.

Two deeper tests conducted at the well reconfirmed the presence of moveable oil. "These tests provide the first potentially commercial flow rates achieved in Kenya and provide real encouragement for the Ngamia test," said Heavey.

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.

Given the positive results so far, Tullow oil announced that it plans to deploy more equipment to accelerate works in Lokichar basin by drilling 11 exploration and appraisal wells as well as as carry out up to five well tests to understand the potential scale of the South Lokichar discoveries.

"The discoveries at Ngamia and Twiga South demonstrate that substantial oil generation has occurred in the South Lokichar Basin, one of more than 10 Tertiary Rift Basins in the Kenya-Ethiopia acreage, each of which is similar in size to the Lake Albert Rift Basin in Uganda," the full year 2012 report said.

Tullow said these tests are expected to deliver rates similar to Twiga South-1. Tullow also owns 15 per cent of the Mbawa-1 well that encountered 52 metres of net gas pay in the the first hydrocarbon discovery in Kenya in the Lamu basin.

The well was plugged and abandoned because it not commercially viable but it confirmed hydrocarbon in offshore Kenya.

The basin bears the same geological formation as Mozambique's coast where large volumes of gas have been discovered.

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