Kenya ministry signs contracts for oil drilling

Saturday July 7 2012

By KENNEDY SENELWA

The Ministry of Energy has signed production sharing contracts (PSC) for exploration of crude oil and gas in Kenya with six international prospecting firms.

Awarding of the seven exploration areas to the firms follows increased international interest after the discovery of oil in Ngamia well drilled in northwestern Kenya by Tullow Oil and Africa Oil Corporation.

Martin Heya, the Petroleum Commissioner at the Ministry of Energy, said the government has  signed PSCs  for onshore exploration area 11A and L19 with ERHC Energy and Rift Energy Corporation respectively.

Pacific Seaboard Investments was awarded the L20 acreage in Lamu basin.

“Kenya is asking for more favourable terms as the country is no longer a frontier exploration area as Tullow has discovered oil,” said Mr Heya.

Total was awarded offshore L22 acreage while ENI got L21, L23 and L24 exploration areas. Edgo of Qatar is negotiating for onshore L14 and offshore L26 exploration areas. Statoil is pursuing offshore L25 acreage.

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In 2011, Total got 40 per cent interest in offshore exploration areas L5, L7, L11A, L11B and L12 where oil and gas wells will be drilled soon.

Total has been operating in Kenya since 1955, and is involved in marketing and distribution of refined oil products. The firm acquired Chevron (Caltex) in 2009.

ENI, which was known as Agip in Kenya, has returned and been awarded L21, L23 and L24 exploration areas.  

“ENI’s entry into Kenya reinforces its presence exploration of frontier basins of East Africa, which has recently led to discovery of significant volumes of natural gas in deep waters of Mozambique,” said the Italian firm.

The company will map oil and gas sites through a seismic survey in exploration areas L21, L23 and L24 covering over 35,000 square kilometres  in the deep and ultra-deep waters of Lamu basin.

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