Home Reports Early Oil from Turkana – Marginal Benefits / Unacknowledged Costs Report

Early Oil from Turkana – Marginal Benefits / Unacknowledged Costs Report

The long-term prospects for Turkana oil continue to improve. Tullow and Africa Oil report that the volume of oil available in the South Lokichar Basin is even higher than previously assumed.1 The barrier to the exploitation of Turkana oil continues to be oil export infrastructure. The only viable approach to the full development of the oil fields is a pipeline to the coast.

Available evidence suggests that there is enough oil in the South Lokichar Basin to support an independent pipeline. The Government has recently put out a tender for an engineering plan (known as a Front End Engineering and Design or FEED) and an environmental and social impact assessment for the pipeline.2 An independent pipeline however will almost certainly result in additional delays. Tullow now reports that the earliest possible date for first exports through a pipeline is 2021. If depressed oil prices continue, further delays can be expected.

Faced with a growing time gap before pipeline- based exports, the Kenyan government is pressing for an interim transportation solution to kick-start exports. Starting in late 2015, reports surfaced of a plan to export Turkana crude oil by truck to Eldoret and then by train to the retrofitted refinery in Mombasa.