PS Liban says gov’t to offer incentives to boost oil and gas exploration

During a talk on the Status of Petroleum Activities in the EAC  partners state, Liban noted that Kenya’s petroleum industry presents significant opportunities for both local and international investors.

He assured that, the government is creating a favorable environment by improving regulations, offering investment incentives, and working with international oil companies.

Speaking in Dar Es Salaam, Tanzania, the PS emphasized that the government is strengthening the petroleum industry by ensuring that investments are well-supported through better policies and infrastructure.

To ensure Kenya retains a larger share of benefits from oil and gas exploration, the government is promoting policies that encourage local participation. These include enabling Kenyan businesses to join the supply chain, which will create jobs and strengthen local enterprises.

Liban revealed that the government has reorganized Kenya’s petroleum blocks to align them with exploration potential and industry standards. In addition, Kenya has made major oil discoveries, especially in Turkana, and that the presence of proven reserves makes the country an attractive destination for oil and gas companies.

The PS outlined the history of oil exploration in Kenya, tracing it back to the 1950s when BP Shell Development Company was granted the first oil exploration license in the Lamu Embayment.

However, between the late 1980s and early 1990s, most oil companies left the country after drilling 30 wells, none of which produced commercial oil. In 2002, interest in oil exploration picked up again when three Australian oil firms acquired offshore blocks. At that time, Kenya had 21 oil exploration blocks, seven offshore and 14 onshore. 

The number of blocks increased to 37 in 2006 and later to 46 in 2012.Kenya’s first significant oil discovery was made in 2012 at the Ngamia-1 well in the South Lokichar Basin. 

Since then, 95 wells have been drilled, with 42 confirming the presence of hydrocarbons. The South Lokichar fields alone hold an estimated 2.85 billion barrels of oil.

On future investments, Liban noted that Kenya has also recorded gas discoveries in the Anza Basin (Bogal-1 and Sala-1 wells) and the Lamu Basin (Mbawa and Sunbird-1 wells). However, further assessment is required to determine their commercial viability.

He outlined upcoming investment opportunities, including the construction of an oil and gas pipeline, maintenance of refineries, and expansion of LPG storage infrastructure. 

The government is also increasing efforts to promote the use of LPG in households and institutions to improve access to cleaner energy.

Once commercial oil production begins, plans are in place to establish petrochemical industries and LPG bulk storage facilities, creating further investment and employment opportunities.