Nairobi — Controller of Budget Margaret Nyakang'o has warned that Kenya's early oil pilot schemes exposed major governance and revenue management gaps that must be addressed before full-scale crude exports begin.

In a report on crude oil export strategies from the Lokichar Basin in Turkana, Nyakang'o said while the pilot phase offered key lessons on logistics, community engagement and technical readiness, it also revealed weaknesses in transparency, accountability and oversight.

She cited limited disclosure of Production Sharing Contracts (PSCs), weak monitoring of the five percent royalty allocated to local communities, and the absence of clear guidelines on how petroleum proceeds should be accounted for and spent.

Nyakang'o proposed that community funds be managed by a legally constituted local Board of Management to prevent misuse.

The Controller of Budget also flagged the lack of a legal framework to restrict the use of oil revenues for recurrent expenditure and called for clarity in law on her office's mandate to authorise withdrawals from petroleum funds, warning that failure to seal these loopholes could undermine long-term sustainability and public trust.