The Ministry of Energy and Petroleum says it is set to approve the field plan for the commercial development of Turkan oil fields by June 30, bringing Kenya’s dream of petrodollars closer to reality.
Gulf Energy, which is set to take over Tullow Oil's project in Kenya is expected to ride on a field development plan (FDP) handed to the energy sector regulator two years ago, eliminating the need for a new blueprint.
The local firm agreed to fully acquire Tullow’s assets in the South Lokichar basin in April ending the British firm’s troubled attempts to start the commercial production of crude oil.
“From where we sit, we have not received anything from Gulf Energy. Of course, there has been speculation but there is no requirement from our side as government for the new project proprietor to hand us a new field development plan,” said the Commissioner for Petroleum at the Ministry of Energy and Petroleum Joseph Otieno at the Nation Media Group Petroleum Conference on Monday.
“As we speak the Cabinet secretary wants to sign the FDP before June 30.”
The ministry says Gulf Energy is unlikely to issue a new FDP for the project in a move to prevent further delays in the commercial exploitation of the oil deposits.
Gulf Energy is also reported to have done a thorough assessment of the FDP presented by Tullow before agreeing to buy the 100 percent stake in the project.
The law also clears Gulf Energy to amend the current FDP even after the start of commercial production.
The Energy and Petroleum Regulatory Authority (Epra) has been reviewing the field development plan for blocks T6 and T7 after its first submission by Tullow in December 2021 and a second in March 2023.
Epra says the technical aspects of the FDP were found to be reasonable, but the commercial implementation was found lacking prompting the sale of the project.
The regulator is set to review the FDP and make recommendations to the Energy and Petroleum Cabinet Secretary.
Once the CS approves the plan, submission to Parliament follows within 30 days after which MPs ratify the plan within 60 to 90 days. Gulf Energy on the other hand would be expected to mobilize funding to begin commercial production.
Energy and Petroleum Cabinet Secretary Opiyo Wandayi said the government will now ramp up the delivery of the project after a slowdown in activities over recent years.
“We are at a very ready stage in the development of petroleum resources. Though the progress of exploring the South Lokichar basin resources has been slow. I can report that the pace towards production will now be faster,” he said.
Gulf Energy is set to be the operator of the project after a 100 percent acquisition of Tullow Kenya BV.
The ministry says the terms to the exit of Tullow are not complicated highlighting Gulf Energy’s intent to begin commercial production in earnest.
“What is happening is not something new within the industry. If you look at any of the renowned oil fields, you will find that the person who discovered it is not the same one producing it. What I can assure the public is that the process is above board,” added Mr Otieno.
