8 June 2018

Kenya: Government to Seek Market for Crude Oil

The government has said it will start sourcing for a buyer of crude oil once it attains the production capacity of 200,000 barrels.

Petroleum and Mining Chief Administrative Secretary John Mosonik on Thursday said the government is optimistic the target will be achieved "soon as good measures are in place for the same".

"I know Kenyans are excited and everyone wants to immediately see the benefit of this engagement. It is too early. We need to give it time before we can fully realise its economic benefit," Mr Mosonik said.

He spoke when he received four trucks loaded with the first batch of crude oil from Turkana at the Kenya Petroleum Refinery (KPRL) depot in Changamwe, Mombasa.

PRODUCTIONEach of the four trucks was loaded with 150 barrels of the oil, which was official flagged off by President Uhuru Kenyatta on Sunday in Lokichar.

The government, he said, had embarked on the process of ensuring that the production capacity at the wells in Turkana increases rapidly.

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He added that in the coming four to five months, the number of trucks ferrying the product is expected to be 100.

"This will basically mean an increase in employment opportunities in Turkana since we shall require more drivers and support staff in that region," he said.

PIPELINE

The official said the government is looking at pumping more barrels of crude oil once the intended construction of the Lokichar-Lamu oil pipeline is complete.

"Today, we have four trucks ferrying oil to Mombasa but rest assured that once the Lamu-Lokichar pipeline is completed, we shall have the capacity to pump between 80,000-100,000 litres a day," he said.

"In the next five years, we want to make oil to be the country's third largest foreign exchange earner, and that is possible because of the proper infrastructure we have put up from Turkana to Mombasa," he added.

ECONOMYHe noted that measures had been put in place to ensure safety and security of the vehicles that will be ferrying the commodity to Mombasa.Mr Mosonik said oil production is a big achievement for Kenya and that it will impact positively on the lives of Turkana residents and Kenyans at large in the near future.

"Part of the proceeds from the oil will go towards improving the lives of the Turkana community," he said.

KPRL Chief Executive Officer Charles Nguyai said the arrival of the trucks marked an auspicious day for the organisation.

OPPORTUNITY

He promised to work hand in hand with Kenya Pipeline Company (KPC) to realise the historic dream of oil in Kenya.

"The initial four trucks have a total payload of 600 barrels of crude oil ready to be pumped into the already prepared holding tanks. As we speak, Tullow is currently holding 80,000 barrels of oil ready to be transported to Mombasa by a similar method," he said.

KPC Board Chairman John Ngumi said the company has invested Sh1.8 billion in improving facilities and that they are looking forward to greater partnerships with KPRL in ensuring proper handling and storage of the oil.

Tullow Oil-Kenya Managing Director Martin Mbogo asked the government to hasten the construction of the Lamu-Lokichar oil pipeline in readiness for the bulky oil that will be produced in Lokichar.

Kenya

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