Tullow Oil Says Kenya Project is Commercially Viable

Tullow Oil Plc and its partners are seeking strategic partners for the next phase of its Kenya project aimed at ensuring its viability.

The oil company intends to an additional Ksh 340 billion due to additional wells to be drilled and larger diameter crude oil export pipeline.

“In Kenya, the revised development plan creates a robust project that has the potential to deliver material value to the Government of Kenya and other stakeholders,” Rahul Dhir, Chief Executive Officer, Tullow Oil Plc said during the release of the firm’s Half Year results for the six months ended 30 June 2021.

The company said the Kenyan project’s development for Blocks 10BB and 13T licences has been revised and has been “commercially, technically and environmentally enhanced”.

According to Tullow, the revised concept allows greater flexibility in adding additional fields into production without significant modifications to the project’s infrastructure.

“A higher production plateau of 120,000 bopd is now planned, with expected gross oil recovery of 585 mmbo over the full life of the field.” 

Key changes in the projects development concept cover factors including the new production data tapped through the early oil pilot scheme (EOPS) where 450,000 barrels of oil were produced from the Amosing and Ngamia fields which cover more than half of the project’s resource distribution.

Tullow Oil estimates capital expenditure covering the upstream and the pipeline to first oil at Ksh 374 billion ($3.4 billion) down from Ksh 319 billion ($2.9 billion) after factoring in a bigger facility processing capacity, additional wells and a bigger pipeline diameter (20 inches).

Tullow and its JV Partners have submitted a draft FDP to the Ministry of Energy & Petroleum for their review. The JV Partners are now working collaboratively with them and will incorporate their feedback and plan to submit a final FDP by the end of 2021, in line with licence extension requirements provided by the Government of Kenya in December 2020.