State owned petroleum company, Qatar Petroleum has entered Kenya’s oil sector through an exploration agreement to acquire a 25% stake in three oil blocks in Lamu Basin from Italian firm Eni (13.75%) and Total (11.25%).
Their entrance comes at a time when other multinational companies are exiting the Kenyan market despite the continued discovery of oil in the East African nation.
Key among them is Africa Oil which abandoned one of the blocks it had been licensed to explore in Lokichar oil project. Royal Dutch Shell, which is a critical partner in the Lokichar blocks also gave up two of its blocks
Africa Oil had a 25 percent stake in the Lokichar oil blocks which was set to start commercial oil production by 2022.
Hunting Alpha (EPZ) also shut down its Kenyan office in February 2019 due to what it termed as “low level of activities in the country’s nascent upstream oil sector.”
The three blocks acquired by Qatar Petroleum are located in offshore Lamu, which has received positive reviews by international companies that have undertaken preliminary surveys.
If the agreement is approved by the Kenyan Government, the partners of the consortium will include Eni with a 41.25% participating interest, Total with a 33.75% participating interest, and Qatar Petroleum with a 25% participating interest.
Eni will be the operator of the blocks, and it will handle the day-to-day running of the blocks, including drilling of exploratory wells.
H E Saad Sherida Al-Kaabi, Minister of State for Energy Affairs, and CEO of Qatar Petroleum said: “We are pleased to sign this agreement to participate in exploring these frontier offshore areas in Kenya and to further strengthen our presence in Africa.
“We hope that the exploration efforts are successful, and we look forward to collaborating with our valuable partners Eni and Total, and the government of Kenya in these blocks. I would like to take this opportunity to thank the Kenyan authorities and our partners for their ongoing and continued support.”
The company’s acquisition of the three blocks is an addition to Qatar First Bank that owns two oil blocks through a local affiliate.
Featured Image Courtesy: Africaoilandpower.com