Tullow Oil says Turkana project still has great potential as it seeks gov't help

Tullow Oil Company has stated that the Turkana oil project in Turkana County has a great potential to generate more resources for the nation if it is strategically managed.

Appearing before the Senate Committee on Energy, Tullow Kenya BV Managing Director Madhan Srinivasan noted that the key milestone to advancing the project and unlocking its value rests on finding a strategic partner to secure project financing and upscale the project investment.

He opined that this will help foster the project's material resource base which he believes can reshape Kenya’s energy landscape, bringing multiple financial and broader social benefits to the nation.

To foster the plan, he told the committee that Tullow is working closely with stakeholders, the Energy and Petroleum Regulatory Authority (EPRA) and the host community in Turkana County.

“Tullow submitted a Field Development Plan (FDP) in March 2023 and we are working on final revisions following feedback from EPRA. Upon reaching final approval, we can commence critical workstreams to enable the project to reach a final investment decision (FID),” said Srinivasan.

He also stated that Tullow has a firm technical capability to develop the Turkana oil resource and is building channels to refine oil and gas development.

“Tullow is building a unique Pan-African operator platform and features a highly experienced management team, which is committed to Africa,” Srinivasan said.

“Tullow has a robust financial position and has generated over $1 billion (Ksh.129 billion) of free cash flow between 2020-23, with a further $200-300 million expected in 2024.”

He maintained that Tullow's proven track record in achieving major operational turnarounds pits them as the best operators to achieve this project.

“Tullow has operated the Kenyan assets and spent over $2 billion (Ksh.258 billion) since the first discovery in 2012, which returned a discovery of 585 million barrels of oil. Tullow continues to be committed to bringing broader social benefits from its operations, such as community water boreholes, which continue to benefit around 20,000 households per year,” he told the committee.

This occurred even as the Senate was investigating circumstances under which 2 batches of crude oil were extracted and sold abroad during the initial phase of the exploration, meant for Analysis and Appraisal.

The Multi-National Oil and Gas exploration company says the Commercial viability extraction phase would see Kenya extract and export a minimum of 120,000 barrels of crude oil to both regional and global refineries. 

Tullow Oil Kenya submitted its Development Plan to formally commence extraction of the crude oil to the Ministry of Energy in 2021. However, 3 years on, there was no response from the government.