Kenya now shifts focus to Magadi basin in oil search
Tullow Oil facility at Ngamia 8 in Lokichar, Turkana County, on February 18, 2020. Nock has been conducting oil exploration activities within the southern part of Block 14T that stretches from Kajiado, Narok to Nakuru and Baringo counties.
The State has targeted its new petroleum exploration campaign on Block 14T in the Magadi Basin with a combined Sh862 million budget over the next three years as the country hopes to strike more oil reserves.
A budget schedule by the Treasury showed that exploration work on the block would be heightened over the next three years with substantial funding allocated from the new financial year starting July. The exploration work on the bloc will get Sh280 million for 2023/2024 before rising to Sh290 million and Sh292 million in the next two successive fiscal years, successively.
The stepped-up campaign on the Magadi Basin comes barely two years after the National Oil Corporation of Kenya (Nock) concluded a Magnetotelluric (MT) exercise on the basin in 2021—an exercise that was aimed at gathering more data on potential petroleum reserves and help in the identification of drill-able prospects in the block.
Nock has been conducting oil exploration activities within the southern part of Block 14T that stretches from Kajiado, Narok to Nakuru and Baringo counties. The exploration block runs from the shores of Lake Bogoria down to Lake Magadi Basin on the border of Kenya and Tanzania.
Kenya is eager for more oil discoveries to bolster the commercial viability of its oil programme. The country first announced the discovery of oil in March 2012 within the Lokichar Basin in Turkana County.
Tullow Oil and its joint venture partners Total Energies and Africa Oil in March month submitted a revised field development plan (FDP) to the government for approval, as the venture steps up its search for a strategic investor.
The approval of the FDP—which will need to be ratified by Parliament —will enable the venture to get a government license to commence commercial drilling of crude oil in the 10BB and 13T oil blocks in Turkana County.
“Since January 1, 2022, there have been ongoing discussions with the government of Kenya on approval of the FDP and securing government deliverables. An updated FDP was submitted on March 3, 2023, and is being reviewed by the government of Kenya before ratification by the Kenyan Parliament,” said Tullow.
The venture had been issued with a 15-month license extension from September 2020 to December 2021 on the condition that they would submit to the government an FDP that is technically and commercially viable for approval.
While the initial FDP was submitted in December 2021, the revised plan follows the revelation that the commercially recoverable oil from the reserves is significantly larger than previously estimated.
An audit by British petroleum consulting firm Gaffney, Cline & Associates led the firms to revise the production capacity of the oilfields to 120,000 barrels of oil per day (bopd), up from previous estimates of 70,000 bopd.
This saw the revision of the FDP that has increased the size of the crude oil processing facility in Turkana and the size of the pipeline to evacuate the oil to Lamu, increasing the projected cost of the project from Sh319 billion to Sh377 billion.
The revised FDP also increased the diameter size of the planned Lokichar-Lamu crude oil pipeline from 18 inches to 20 inches to handle a higher product volume and drilling of additional exploration wells.
