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he Cabinet Secretary in the Ministry of Energy and Petroleum Davis Chirchir in a meeting with stakeholders on May 24, 2023. 

Energy and Petroleum Cabinet Secretary Davis Chirchir stated on Wednesday, May 24,  that Kenya did not make any money from oil exploration in South Lokichar, Turkana County.

Speaking before the parliamentary Public Accounts Committee, Chirchir stated that the exploration project was done to test the marketability of the product and allow the county government of Turkana to get the necessary experience and capacity.

 Further, he noted that the government owed International Exploration Companies (IOC)Ksh3 billion ($23.7 million) for the project.

“There were no excess funds to be shared in this early oil project scheme in line with the provisions of the Act. If anything, the IOC is owed USD23.7 million on account of the early oil project scheme.

“The crude oil sold from the South Lokichar Basin had been produced from exploration and appraisal activities. It was not commercial production,” Chirchir stated.

He explained that the project was still at an early exploration stage and therefore the cost incurred to start exploration was huge and profit could not be made immediately. 

“When you look at the cost of any business, you don’t expect to make profits in the first two to three years because those are the years of investments.

“The initial phase of the project was expensive because the objective was to ensure that there is a seamless process and a ready market for the oil,” the CS added.

The committee noted that since the exploration began four years earlier, the government had drilled 240,000 barrels of crude oil all sold to make Ksh3.7 billion, money that was paid back to investors. 

However, Chirchir added that there was still hope for Kenya to benefit from the project adding that it would benefit the country and the local communities as well.  

"Yes, there was hope and there’s still hope. I urge this House and Kenyans at large to quickly go out of our way to support this project and be conscious of the climate change issue. Investors are not putting their money where their policies on climate don’t agree with the developers of the climatic-challenged projects,” he added.

Earlier on Tuesday, May 23, China's largest producer of oil and petrochemical products sent representatives to Tullow Oil to express interest in the project

Oil exploration began in 2019 when the Kenyan government issued Tullow Oil with the license to produce 100,000 barrels daily.

Additionally, within the same year, former President Uhuru Kenyatta announced Kenya's entry into the oil export market, with the goal of capitalizing on and earning an average of Ksh1.2 billion from selling 22,000 barrels of crude oil.  By Joy Kwama,


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