Kenya is just weeks away from announcing the discovery of new oil resources in the Lamu basin, bigger than what was found a decade ago in Turkana, in what could be a turning point for the country’s dreams of reaping petrodollars.
Italian oil exploration company Eni — in partnership with France-based oil and gas company TotalEnergies and Qatar’s state-owned oil and gas firm Qatar Energy — is racing to conclude a five-kilometre exploratory drilling deep water well that will establish the potential oil resources in the Lamu basin.
The oil resources that can be recovered from the Block L11B are estimated at about 700 million barrels according to early conservative estimates, more than a fifth of Turkana’s commercially extractable volume of 585 million barrels.
The large fiscal windfall associated with new oil resource revenue could help Kenya boost development and improve the standards of living for citizens through access to key services and amenities such as roads, health, food security and education.
The well is located approximately 170km from the coast, underneath the Indian Ocean seabed where Eni has been prospecting and drilling for oil.
Eni’s drillship SAIPEM 12000 has been on location within Block L11B since late December 2021, when it started drilling, and is expected to complete operations this month.
The drilling was expected to start earlier in the month but was delayed due to a number of factors including meeting requirements to comply with Ministry of Health protocols to mitigate the Covid-19 pandemic.
Seismic surveys revealed that the area has the potential for oil resources estimated at four billion to 4.8 billion barrels. Oil and gas explorers use seismic surveys to produce detailed images of the various rock types and the location beneath the earth’s surface and to determine the location and size of potential oil and gas reservoirs.
Eni expects to release deposits results of its drilling campaign in the block that would determine whether there is commercial viability.
Eni Kenya BV managing director Tavolini Enrico remained tightlipped on Eni’s prospects in Lamu promising additional information later.
“We shall give you an update in the next two weeks,” Mr Tavolini said in response to queries.
Once a discovery is made, confirmation through appraisal wells would be needed. This would mean Eni and it’s partners would dig additional wells to confirm whether any discovery would be big enough for the oil firms to develop Kenya’s first deep water field.
Early data however indicates the existence of oil resources, what is technically referred to as an active petroleum system in the area.
The well in the Lamu Basin offers Kenya another chance to become an oil producing country. It would come a decade after British exploration firm Tullow Oil made Kenya’s first oil find in Turkana County’s South Lokichar sub basin.
Kenya first announced the discovery of oil in Block 10BB and 13T in Turkana in March 2012.
The country is however yet to fully commercialise the crude oil.
“Data from this well and other exploration activities show that the Mlima 1 prospect could have a much more considerable accumulation than the discoveries in the South Lokichar basin,” said Rita Maina, a senior energy transition advisor at the Kenya Civil Society Platform on Oil and Gas.
“If the drilling is successful, there is a high probability that the South Lokichar basin discoveries will take a back seat because the Mlima 1 prospect will have a more significant economic benefit to the country and will be easier to develop,” she added.
Mlima-1 is tipped to be the first commercial oil discovery in a region where exploration activities to date have almost exclusively resulted in gas discoveries.
An oil discovery in the Lamu basin would push Kenya to guard it’s maritime borders in the area amid a border row with Somalia. The basin lies within the disputed territory with Somalia.
Last year, Kenyan President Uhuru Kenyatta said the country will not cede even an inch of the disputed area.
Turkana oil wells
Tullow has been under pressure from Kenya to develop the Turkana oil wells that it expects to produce up to 120,000 barrels per day once production starts.
Tullow and its partners in the project, Africa Oil and Total, had initially planned to reach a final investment decision in 2019 and production of the first oil between this year and next year.
In October last year, Tullow presented a revised Field Development Plan for oil in the Turkana oil fields to the government of Kenya just in time to beat the set deadline of December 2021.
Had the plan not been submitted in time, then they would have risked losing concession on their exploration block as stipulated in the production sharing contract.
The British firm expects to recover 585 million barrels of oil from the project over the full life of the field.
The commercially extractable volume for the Turkana South Lokichar basin rose to 585 million barrels from the previous estimate of 433 million barrels, according to British petroleum consulting firm Gaffney Cline Associates.