When Tullow discovered crude oil in 2012 in Turkana County, the sleepy Lokichar town came alive.
Local and foreign investors moved in and built malls, shops, hotels and entertainment joints along the Kitale-Juba Road.
There was good money in circulation as the British firm had employed hundreds of people and sub-contracted other companies in oil drilling.
This led to economic growth in a town that had for decades been hard hit by banditry between the Turkana and Pokot pastoral communities. Biting poverty, poor infrastructure and drought were common.
The coming of the oil firm transformed the town as it constructed good roads that created a conducive environment for trade. Businesses such as fuel stations, hotels, banks, entertainment, retail and wholesale ventures changed the face of Lokichar town.
This, however, changed when the oil drilling was scaled down, destabilising the business community that had been used to the money in circulation.
Mr Eliud Ekeru, the proprietor of Black Gold Kileja Hotel, says most of his customers were security guards, drivers and suppliers working for Tullow Oil and associated firms.
“Business was good. I even bought another piece of land to expand my business. Despite charging as low as Sh500 per room, on average we get only two guests in a week,” says Mr Ekeru.
He now relies on the little he gets from the meals he sells to county employees, long-distance drivers and those working for non-governmental organisations.
“The suffering of the business community has already been felt by the county revenue department. They now negotiate with traders who would prefer closing their businesses because they cannot pay taxes,” he says.
Where’s the money?
Mr Lucas Amron, 69, a resident of Morongole village, wonders what happened to the money Kenya got from the sale of crude oil under the Early Oil Pilot Scheme.
“The trucks that used to ferry crude oil from Lokichar to Lamu are no more; where is our five per cent share?” quips Mr Amron.
“There are no benefits from crude oil since 2012? No, give us something. You can’t just say Lokichar is where crude oil was discovered, but we don’t have even basic necessities like clean and affordable water,” he adds.
Another local, Ms Mary Emase, offers: “The oil wells are on our land. We are just choking from the waste left behind by the oil exploration and this might be harmful to our lives. Drought is killing our animals and the company that would have helped us is nowhere in sight.”
When Tullow and its Joint Venture Partners submitted a draft Field Development Plan (FDP) to the Ministry of Energy and Petroleum for review, it was optimistic that petroleum activities would resume.
Tullow sought to deliver Kenya’s first oil and gas development that would represent a stable, long-term source of income.
The partners are reportedly working with the ministry and will submit a final FDP by the end of the year, in line with license extension requirements provided by the government in December last year.
Tullow believes the project is an attractive commercial prospect for investors looking to access the East Africa oil and gas sector in both the upstream and midstream.
“It is intended that a strategic partner will be secured ahead of a Final Investment Decision,” says the British oil explorer in a report.
Over the past year, Tullow and its partners (Africa Oil and Total Energies) have completed the redesign of the Kenya development project (Blocks 10BB and 13T licenses) to ensure it’s a technically, commercially and environmentally robust project.
“A higher production plateau of 120,000 barrels of oil per day is now planned, with expected gross oil recovery of 585 million barrels of oil over the full life of the field. This resource position is supported by external international auditors Gaffney Cline Associates (GCA) who have issued a Competent Persons Report (CPR) and confirmed the life of field resource position of 585 million barrels of oil,” states the report.
The partners have assured that Carbon emissions will be limited through a combination of heat conservation, use of associated gas for power and reinjection of excess gas into the reservoir. They intend to use the national grid, which is substantially powered by renewables and options, to offset remaining emissions.
As per the previous development plan, the 825km pipeline that will transport the crude oil from Turkana to the port of Lamu will be heated and buried to avoid disruption.
Land acquisition process for construction of the Lokichar-Lamu pipeline, whose implementation was set for last year, remains a tough task as local leaders maintain a hard-line stance on the issue.
This is despite Petroleum Cabinet Secretary John Munyes saying the pipeline, which is a key component of the Sh2.5 trillion Lamu Port South Sudan Ethiopia Transport (Lapsset) corridor, was critical for Kenya to realise its ambition of joining the league of oil exporters through production of between 80,000 and 100,000 barrels a day.
Moved to court
In 2019, the Turkana county government went to court seeking conservatory orders to stop the implementation of the National Land Commission (NLC) decision to acquire the indigenous ethnic land even as Governor Josphat Nanok and Turkana South MP James Lomenen complain about lack of transparency.
Mr Nanok says NLC proceeded to initiate the acquisition of the land in total disregard of the constitution and the Land Act.
“The county government is the custodian of the community land and must be included in such processes, such as compulsory land acquisition. They must involve us for fruitful consultations,” says the governor.
Mr Lomenen supports the county government for suspending the land acquisition process in court “to ensure title deeds have been issued and valuation for all trees has been done for compensation”.
“Land in Turkana can’t be taken without permission from leaders and locals as it will remain our land. Our land should only be leased out for a certain period of time and reverted to owners or else we will kill pastoralism in the affected areas,” says the MP.
Kenya Land Alliance (KLA) has called for countywide sensitisation on acquisition of land for the Lapsset project in Turkana.
KLA Chief Executive Faith Alubbe says locals have remained in a state of confusion over for lack of reliable information about the project. The situation has left many speculating with value of land going up exponentially.
With plans already in place for the NLC to acquire land along the corridor, she wants the agency to identify specific places that will be affected.
“To avoid speculation, the ministries of petroleum and land should help locals understand plans for compensation, amount to buy land or even compensation for trees destroyed,” notes Ms Alubbe.
She warns that delays on the engagement and sensitisation of locals have turned the exercise into a political issue.
Mr Munyes, on his part, says political hardliners may delay the revenue sharing formula for national, county and local community that was agreed to be 75:20:5 in the Petroleum (Exploration and Production) Act 2019.
Land for pipeline
Mr Munyes says the State has acquired land for the pipeline in Lamu, Garissa, Meru, Isiolo and Samburu Counties but Turkana is yet to give in.
“I wonder why local leaders are talking of delayed benefits yet for the country to commercialise crude oil, we must have land to lay a pipeline from Lokichar to Lamu to assure us of 80, 000 barrels a day,” he says.
He says the State is focused on up scaling petroleum activities with planned 300 additional wells that must be drilled for the country to successfully produce 150,000 barrels a day.
In 2019, the country sold the first consignment of 200,000 barrels of crude oil under Early Oil Pilot Scheme for Sh1.2 billion. Tullow and its partners have so far spent Sh300 billion for exploration and development of petroleum activities.
Tullow says it will provide water to local communities from Turkwel Dam through a pipeline. An exploration and appraisal plan will also be put in place to ensure the remaining five discoveries are developed to extend and sustain initial plateau rates while keeping costs low by using the rigs used for development drilling.
Future phases will also focus on additional exploration potential within Blocks 10BB and 13T licences as well as the wider Blocks 10BA and 12B license acreage.
Resistance from locals
However, there’s still resistance from locals in the Lokichar Basin drawn from Turkana South and East sub-counties. They’re facing a risk of possible exposure to harmful chemicals that can cause a long-lasting effect on the environment.
This was revealed by a multi-agency team consisting of officials from the county government, the National Environment Management Authority (Nema) and The Energy and Petroleum Regulatory Authority (Epra) during a fact finding mission.
Governor Nanok had raised concerns over poor waste management of hazardous chemicals from oil exploration activities in the South Lokichar Basin.
Mr Nanok claimed there was an abandoned Etir well with poisonous chemicals exposing locals, livestock and general ecosystem to danger.
The team confirmed that Amosing 3 and Etiir oil well sites are the most affected. Recommendations issued to the oil explorer are yet to be implemented.
The team collected samples of the pollutants for laboratory confirmation but findings during the inspection had revealed possible seepage seen by discoloration of the ground and tear of the protective linings.
The county environment, water and natural resources chief officer Moses Natome has called on Nema to consider revocation or non-renewal of the license that permits the use of Twiga 1 station as a temporary waste consolidation area until Tullow finds a better solution.
Mr Natome hinted at the possibility of mischief on the part of the oil operators although the company has a history of compliance to set standards in other jurisdictions.
He also calls on the Petroleum ministry to work closely with the county government for continuous monitoring of operations to avoid unnecessary conflicts.