Kenya Postpones First Crude Oil Export

OILMONSTER.COM- Kenya's plan to export crude under the Early Oil Pilot Scheme (EOPS), remains elusive, after Tullow Oil pushed the date of the first shipment to June.

The project was launched in June 2018, and was to deliver the maiden shipment of 400,000 barrels in February this year.

The British oil firm said the new date is informed by the fact that it has failed to hit a target of trucking 2,000 barrels of crude daily from the oilfields in South Lokichar in northwestern Kenya for storage at the refinery in Mombasa.

Only 60,000 barrels have been transported to the Kenya Petroleum Refinery Ltd depot in Changamwe, a development that continues to put the government’s ambitions to be the first country in East Africa to export crude on hold.

In its latest trading statement and operational update, Tullow Oil said, “The transfer of crude oil from Turkana to Mombasa by road continues as part of the EOPS with an average of eight trucks being dispatched every two days, transporting approximately 600 barrels per day.”

The failure to achieve the February 2019 target is a major setback for the controversial scheme, which the government contends is a necessary precursor to full development and commercialisation of the crude oil business.

The scheme, which has encountered numerous roadblocks — some literal after the local community protested about the neglect of its infrastructure and security, amid disputes about the revenue-sharing formula — is designed to prove Kenya’s capacity to export crude oil and prepare the international market for full production.

According to Tullow, substantial progress has been made towards full production, with the final investment decision between the joint venture partners — the Kenya government, Africa Oil Corp and Maersk Oil — expected to be reached later this year to guarantee full-scale exports in 2021, when a crude pipeline to the Lamu shoreline is expected to be ready.

“This will require several key milestones to be achieved throughout this year, including land acquisition, commercial frameworks and contract awards,” said the firm.

Courtesy: www.theeastafrican.co.ke