Turkana oil project to delay further over plan review

Tullow Oil now expects to know the fate of its updated plan to develop the Lokichar oil fields by the end of December this year.

The field development plan (FDP) that Tullow had presented to the Energy and Petroleum Regulatory Authority (Epra) was rejected in June, with the industry regulator citing gaps.

Tullow now says the review of the FDP has been extended by six months to December 31.

The plan, which outlines the strategy and steps the UK firm will take in developing the fields where oil was discovered in 2012, has experienced a back and-forth between the exploration company and the government since December 2021.

An updated FDP, in which Tullow said it would produce its first oil by 2028, was submitted in March 2023. This was however returned to the firm without approval, with Epra instead asking for more details.

"Tullow continues to work collaboratively with the Government of Kenya as they evaluate the amended Field Development Plan.

"Epra has provided useful feedback and the FDP review period has been extended for a further six months to 31 December 2024," said Tullow Oil when it published its results for the half year to June 2024.

"Tullow is continuing its cooperation and collaboration with the government to reach final approval of the FDP. Discussions continue with prospective strategic partners for this project."

If it is approved by Epra in December, it will also need to get further nods from the Energy and Petroleum Ministry and Parliament.

On approval, Tullow expects to be issued with a production licence. The firm expects this to ease the process of getting a strategic investor, whose injection of much-needed capital is expected to enable Kenya to move into the league of oil-producing countries.

In the Turkana oil project, Tullow was in a joint venture with Africa Oil Corporation and Total Energies - which held a combined stake of 50 per cent - leaving Tullow as the sole player in the project, at least until it onboards a strategic partner.

The two firms quit the project last June citing differing strategic objectives. The government is yet to give consent to their withdrawal from the project.

Tullow expects the exit of the two firms to give it more flexibility in operating the blocks.