Tullow has a track record of discovering significant oil resources in East Africa. The Group first started exploring in Uganda in 2006, successfully opening the Lake Albert Rift Basin, which has discovered resources of some 1.7 billion barrels of oil. Tullow has taken its knowledge and understanding of the geology in Uganda across into neighbouring Kenya. Since 2012, Tullow’s successful exploration and appraisal drilling campaigns in Kenya have resulted in the opening of a second new tertiary rift play in the South Lokichar Basin. Following a full assessment of all the exploration and appraisal data, Tullow estimates that the South Lokichar basin contains the following recoverable resources: 240 – 560 – 1,230 mmbo (1C–2C–3C) from an overall discovered STOIIP of up to 4 billion barrels. Watch the video below to see how Tullow, its Partners and the Government of Kenya are working togeether to develop these resources through Project Oil Kenya.
Tullow and its Joint Venture Partners have proposed to the Government of Kenya that the Amosing, Ngamia and Twiga fields should be developed as the Foundation Stage of the South Lokichar development. This stage would include a 60,000 to 80,000 bopd Central Processing Facility (CPF) and an export pipeline to Lamu. This phased approach brings significant benefits as it enables an early FID, takes advantage of the current low-cost environment for both the field and infrastructure development and provides the best opportunity to deliver First Oil in a timeline that meets the Government of Kenya (GoK) expectations. The installed infrastructure from this initial phase can then be utilised for the optimisation of the remaining South Lokichar oil fields, allowing the incremental development of these fields to be completed at a lower unit cost post-First Oil.
The foundation stage will target volumes of around 210 mmbo of the total estimated 2C resources of 560 mmbo and a plateau rate of 60,000 to 80,000 bopd. The incremental development of the remaining 2C resources and the significant upside potential is expected to increase plateau production to 100,000 bopd or greater.
Following the signing of the commercial Heads of Terms with the Government of Kenya in June 2019, Project Oil Kenya continues to make good progress. The upstream and midstream Engineering, Procurement and Construction (EPC) tenders are expected to be issued to the market by the end of 2019. Well tender activities are on track, with bids received and evaluations ongoing. The midstream Environmental and Social Impact Assessment (ESIA) has been submitted to the National Environment Management Authority (NEMA) with approval expected in the first quarter of 2020. Consultations for the upstream ESIA are ongoing, ahead of the ESIA being shared with NEMA before the end of the year.
The FID for Project Oil Kenya continues to be targeted in the second half of 2020.
Early Oil Pilot Scheme (EOPS)
In early June 2018, the transfer of stored crude oil to Mombasa, by road, commenced. The EOPS will transport oil produced from injection and production testing at the Ngamia and Amosing fields. In May 2019, EOPS production was increased from 600 bopd to 2,000 bopd and the reservoirs, wells and associated facilities have been performing well.
On 26 August 2019, East Africa’s first ever export of oil, a cargo of 240,000 barrels, was flagged off from the port of Mombasa by HE Uhuru Kenyatta, the President of Kenya. This was the first lifting of oil from the Early Oil Pilot Scheme (EOPS) to the international market. The EOPS production of 2,000 bopd continues with oil being transported by road from Lokichar to Mombasa.