Kenya is headed to become the first oil exporter in east Africa, moving in less than five years from being a have-not nation to the regional leader in cutting reliance on fuel imports.
After Tullow Oil found oil last year, Kenya is set to start shipments in 2016, overtaking neighbouring Uganda, where Tullow found crude more than seven years ago.
The UK explorer planned to start pumping in Kenya as soon as next year, chief operating officer Paul McDade said yesterday. Kenya’s deposits might top 10 billion barrels, the company said.
Exports will underpin Kenya’s shilling and the government is pushing to get a lead on Uganda and the Democratic Republic of Congo.
Oil would allow Kenya to “diversify export earnings and act as a catalyst for infrastructural spending”, said Phumulele Mbiyo, the regional head of research at Stanbic Bank in Nairobi. “The shilling is expected to benefit from inflows of foreign exchange and reduced spending on fuel imports.”
Kenya imports all its fuel, almost 80 000 barrels of oil a day at a daily cost of more than $8 million (R81m), US government data show.
Tullow estimates it has found more than 300 million barrels of oil equivalent resources after making three discoveries in Kenya’s South Lokichar Basin.
Tullow and partner Africa Oil plan to spend at least a year seeking further deposits.
The partners still have to submit their field development plan to the government.
Eventually, a pipeline would be built to a terminal on the Indian Ocean coast, McDade said. – Bloomberg
