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in environmentally sensitive areas of Uganda. Under French reporting rules, from 2017 companies are required to demonstrate an awareness of the impact of their activities. e environmental NGOs claim that Total’s failure to mention its Ugandan work in its report consti-
tutes a violation of the law.
Friends of the Earth said it had been working
on the project for months and that evidence had piled up. e move was particularly important, it said, because it allowed action to be taken before environmental damage was done.
Methodical
e Kenyan project is of a smaller scale than the Uganda plan but the government appears more willing to help drive the South Lokichar plan for- ward. e Early Oil Production Scheme (EOPS) ramped up to 2,000 bpd of output in May, from 600 bpd, with the rst cargo anticipated to be exported from Mombasa in the third quarter of the year.
On June 25, the partners signed a heads of terms (HoT) with the government of Kenya. e government had been criticised in April for delaying this.
Tullow said this was a “material and encour- aging step forward which gives all parties con- fidence that the development project will be
robust at low oil prices”. It went on to say that front-end engineering and design (FEED) had been completed on the upstream and midstream and should provide for rst oil to come within three years from FID.
at said, progress is slower than expected, including in the need for community consul- tations. As such, ESIAs will be submitted in the second half of this year. ese had been hoped to be delivered in June. Given these delays, Tullow said FID would likely only come in 2020. is is not a surprise, as the company had begun play- ing down ambitions for FID earlier this year.
Tullow’s CEO, Paul McDade, noted the com- pany’s progress over the rst half of the year, predicting another year of free cash ow. “I am particularly pleased with the signi cant progress we have made in Kenya and the agreement with the government over a number of key commer- cial principles will greatly assist us in driving the project to FID.”
e South Lokichar assets are based in Blocks 10BB and 13T. e foundation stage of the plan involves three oil elds, Amosing, Ngamia and Twiga, with output to be 60,000-80,000 bpd. e rst phase involves the drilling of 210 wells on Ngamia and 70 at Amosing.
By pursuing a phased plan, with scope for increasing output at a later date, the Kenyan Ministry of Petroleum and Mining commented that this would provide signi cant bene ts. It allows “an early FID, [it] takes advantage of the current low-cost environment for both the eld and the infrastructure development and pro- vides the best opportunity to deliver rst oil in a timeline” that meets the Kenyan government’s needs. Additional exploration is planned by the country in the Lamu, the Anza trough, the Man- dera Basin and the Tertiary Ri .
Tullow has a 50% stake in the South Lokichar assets, and is the operator, while Africa Oil and Total own 25% each. e blocks contain around 550 million barrels, with around 220 million bar- rels to be developed under the foundation phase. Tullow also noted it had written o exploration costs on Block 12A in the country.
In April, rumours emerged that one of the project partners was intending to pull out of the Kenyan project, which would likely cause further delays. Signing the legally binding HoT is likely to provide reassurance to the companies that progress is on the way.
The Kenyan export plan
Source: Africa Oil
Week 26 02•July•2019
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