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Why Total and Africa Oil quit Kenya’s oil project
Two joint partners in Kenya’s quest for oil in Turkana have quit the project, exerting new pressure on the main operator Tullow Oil, which has been unable to take the exercise off the ground after the British oil explorer ran out of cash.
Africa Oil says it abandoned the Kenya project, opting to concentrate in regions with high petroleum potential while Total withdrew barely months after it said it was considering other options to monetise its stake.
The duo owned a 25 percent stake apiece in blocks 10BB, 13T and 10BA in the South Lokichar Basin, and their exit leaves the cash-strapped Tullow Oil to solely continue with the venture.
The twin exits have left Tullow with full ownership of the three blocks at a time when concerns over its viability are mounting.
“We have taken the decision to exit our Kenya concessions as our strategy has shifted to focus on production and high potential exploration opportunities, including our Orange Basin portfolio where we are now appraising the exciting Venus discovery, offshore Namibia,” said Africa Oil President and chief executive Keith Hill on Tuesday.
TotalEnergies had at the end of last year indicated plans to dispose of its stake, as doubts lingered on Kenya’s ambition to join the league of oil exporting nations.
“In Kenya, TotalEnergies holds interests in onshore permits (10BA, 10BB and 13T). On Blocks 10BB and 13T, TotalEnergies is studying the different options to monetise the oil discoveries made,” the firm said in a trading update last December.
The two developments are the closest that major stakeholders in Kenya’s oil project have come to question the volume of the country’s oil reserves, which Tullow and Africa Oil discovered in 2012.
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